NATIONAL COUNCIL ON DISABILITY

Performance & Accountability Report (PAR)

FISCAL YEAR 2011

National Council on Disability (202) 272-2004 Voice

1331 F Street, NW, Suite 850 (202) 272-2074 TTY

Washington, DC 20004 (202) 272-2022 Fax

www.ncd.gov
i

TABLE OF CONTENTS Page

Message from the Chairman..................................................................................... 1

How to Use This Report........................................................................................... 4

Part I: Management’s Discussion and Analysis.............................................................. 5

NCD at a Glance...................................................................................................... 5

Mission & Vision..................................................................................................... 5

Strategic Goals........................................................................................................ 6

NCD Organizational Overview..................................................................................... 7

Organizational Chart................................................................................................ 8

Performance Goals, Objectives, and Results in Brief........................................................... 8

Analysis of Financial Statements.................................................................................. 11

Analysis of Management Controls, Systems and Compliance................................................ 12

Chairman’s Statement of Assurance.......................................................................... 14

Part II: Performance Section.................................................................................... 16

Performance by Strategic Goals................................................................................... 17

Part III: Financial Section....................................................................................... 26

Message from the Executive Director............................................................................ 26

Exhibit A – Independent Auditors’ Report

Exhibit B – List of Acronyms
 National Council on Disability

An independent federal agency making recommendations to the President and Congress 

to enhance the quality of life for all Americans with disabilities and their families.

FY 2011 Performance & Accountability Report 1

Message from the Chairman

Jonathan Young

Council Chair

On behalf of the members of the National Council on Disability (NCD or the Council), I am 

pleased to submit the Fiscal Year (FY) 2011 Performance and Accountability Report (PAR). The 

Council received an unqualified opinion from its independent auditors on its FY 2011 annual 

financial statements. 

We are pleased to report NCD has effectively addressed the four material weaknesses reported in 

the FY 2010 independent audit by making substantial progress on improving internal agency 

operations and financial management. To increase accountability and transparency, the Council 

has implemented best practice procedures in accordance with guidance from the Government 

Accountability Office (GAO) and AICPA Audit Committee Effectiveness Center. During the 

course of the past year, NCD has, among other things, developed and implemented a corrective 

action plan, updated its by-laws, strengthened reporting to the NCD Audit & Finance Committee, 

conducted a formal risk assessment, established procedures for annual completion of a risk 

assessment, and reached the final stages of updating and revising internal policies and 

procedures.

While NCD has addressed the four material weaknesses reported in the FY 2010 independent 

audit, the on-going monitoring of internal control effectiveness has been reported in our FY 2011 

independent audit as a significant deficiency. Effective internal control, risk assessment and 

mitigation, and segregation of duties is often challenging for small agencies such as NCD due to 

resource limitations. However, because NCD took aggressive steps to address the material 

weaknesses reported in FY 2010, the agency is now equipped to address the FY 2011 significant 

deficiency by utilizing tools such as its risk assessment and linking it to the monitoring and 

effectiveness of internal controls.

The Council’s role as an independent advisor on disability matters to the President and Congress 

is essential to assuring the Federal government is well informed and qualified to perform their 

duties and effectively serve the public, including individuals with disabilities. NCD carries out 

its mission to promote equality of opportunity, full participation, independent living and 

economic self-sufficiency for people with disabilities of all ages and backgrounds by: continually 

reviewing disability programs and policies, meeting with people with disabilities and other 

stakeholders around the country to learn about on-the-ground realities, and providing advice, 

analysis and recommendations on disability policy to the President, Congress, and other federal 

agencies. NCD’s analysis and recommendations have led to enactment of important laws and 

other improvements to the programs and services provided by the many federal agencies that 
 National Council on Disability

An independent federal agency making recommendations to the President and Congress 

to enhance the quality of life for all Americans with disabilities and their families.

FY 2011 Performance & Accountability Report 2

serve the disability community. NCD’s most notable achievement is drafting and recommending 

the Americans with Disabilities Act.

During FY 2011, the Council extended its engagement in several substantive areas that 

contributed to the nation’s progress toward achieving the goals of equality of opportunity, 

independent living, full participation, and economic self-sufficiency for all people with 

disabilities. These efforts have been undertaken as effective stewards of limited fiscal resources 

and included promoting success in the design and implementation of health care reform, 

increasing telecommunications access, and enhancing protection of individual rights.

The Council partnered with the White House on several initiatives including the White House 

Conference on Bullying Prevention, and the implementation of the Affordable Care Act. NCD 

also partnered with the U.S. House of Representatives Bi-Partisan Disabilities Caucus to hold a 

hearing on challenges and issues of concern to people with disabilities highlighted by 

deliberations over the federal budget. NCD also released a series of timely reports, publications 

and letters including:

 Report: The Power of Digital Inclusion: Technology's Impact on Employment and 

Opportunities for People with Disabilities

 Letter: To Secretary Duncan regarding forthcoming NCLB waivers 

 Letter: To Massachusetts DDS Commissioner Urging Elimination of Electric Shock, 

Other Aversives 

 Briefing Paper: "Bullying and Students with Disabilities" 

 Report: Rising Expectations: The Developmental Disabilities Act Revisited

 Letter: To USAID Administrator Raj Shah in Wake of Disaster in Japan

 Letter: To TSA Administrator John Pistole Regarding Security Screenings

The Council released its Annual Progress Report on October 31, 2011, in accordance with 

NCD’s authorizing statute.

NCD is proud of its successful efforts in promoting equality of opportunity, full participation, 

independent living, and economic sufficiency for all individuals with disabilities, of all ages, 

throughout the country. I want to express my profound appreciation for the hard work and 

dedication of NCD’s members and staff, who continued to make important policy contributions 

while simultaneously addressing four material weaknesses reported in the FY 2010 independent 

audit. We remain steadfast in our commitment to carrying out our responsibilities in working 

with the President, the Congress and each level of local, state and federal agencies to accomplish 

our nation’s vision of valuing and respecting each member of our society. 
 National Council on Disability

An independent federal agency making recommendations to the President and Congress 

to enhance the quality of life for all Americans with disabilities and their families.

FY 2011 Performance & Accountability Report 3

Sincerely,

Jonathan Young, Ph.D., J.D.

Chairman
FY 2011 Performance & Accountability Report 4

How To Use This Report

This Performance and Accountability Report (PAR) presents comprehensive performance and 

financial information on the National Council on Disability’s (―NCD‖ or ―Council‖) operations. 

The report was prepared pursuant to the Accountability of Tax Dollars Act of 2002 and Office of 

Management and Budget (OMB) Circular No. A-136, revised, Financial Reporting 

Requirements, and covers activities from October 1, 2010 through September 30, 2011.

The Council places a high importance on keeping the public informed of its activities. To learn 

more about who we are and what we do to serve the American public, visit NCD’s website at 

http://www.ncd.gov/Accountability to access this report.

The FY 2011 Performance and Accountability Report is organized into four sections:

Section I – Management’s Discussion and Analysis (MD&A) provides an overview of the 

NCD. It describes our mission, organizational structure and regulatory responsibility.

Section II – Performance Information summarizes the NCD’s strategic goal and related 

objectives and provides a forward-looking discussion of future challenges.

Section III – Financial Information, including Auditor’s Report details the NCD’s financial 

performance by highlighting the financial position, audit results and describing the NCD’s 

compliance with key legal and regulatory requirements.

Section IV – Other Accompanying Information

Exhibit A – List of Acronyms
Part I: Management's Discussion and Analysis

FY 2011 Performance & Accountability Report 5

NCD at a Glance

NCD was initially established in 1978 as an advisory board within the Department of Education 

(Public Law 95-602). The Rehabilitation Act Amendments of 1984 (Public Law 98-221) 

transformed NCD into an independent agency and required NCD to provide expert advice to 

Congress and the Administration on a continuing basis, with particular emphasis on helping to 

ensure that disability programs and policies promoted independence rather than dependence. 

Revisions to NCD’s statutory mandate were subsequently made by the Rehabilitation Act 

Amendments of 1992 and 1998 and the Education of the Deaf Act Technical Amendments of 

1993.

NCD is composed of fifteen members appointed by the President and confirmed by the U.S. 

Senate. The Council members set the agency budget and establish the parameters for what it will 

support. The NCD executive director has full responsibility for carrying out the agency’s 

operations as necessary to accomplish the goals and mission of the agency as established by the 

Council members.

Mission 

The mission of NCD is to promote equality of opportunity, full participation, independent living

and economic self-sufficiency of people with disabilities of all ages and backgrounds by 

providing advice, analysis and recommendations on disability policy to the President, Congress

and other federal agencies. 

NCD is tasked with completing an annual progress report, no later than October 31 each year,

regarding the state of disability in the United States and delivering this along with related 

recommendations to the President and Congress each year. The agency also completes studies 

and research reports on other issues of concern to the disability community, and uses those as 

background for developing policy recommendations for the President, Congress and other 

federal agencies.

Vision

We lead by facilitating, articulating and promoting inclusion and empowerment 

of individuals with disabilities to live, learn and earn based on informed 

choices. 

Disability touches everyone. Almost all Americans have some experience with disability through 

their own daily experience or contact with relatives, colleagues or friends. At some point, most 

Americans will experience or know someone with a disability that is lifelong, was acquired

owing to an illness or an injury or as part of the typical aging process. 

People with disabilities represent a diverse group which includes individuals with physical, 

sensory and intellectual disabilities. Disability is individualized and the cause, consequences, and 

impact disability has on the ability to participate in everyday life varies. Some disabilities 

remain static throughout a person's life while others may have periods of remission or regression. 
Part I: Management's Discussion and Analysis

FY 2011 Performance & Accountability Report 6

Through its outreach efforts, in various community venues, and at its quarterly meetings, NCD 

continually learns about the impact of disability on individuals, families, and their communities. 

Outreach efforts generate findings that are shared through comprehensive reports, policy briefs, 

media outreach, our award-winning Internet website (http://www.ncd.gov/index.html), and a 

monthly newsletter that receives worldwide attention.

Despite their diverse profile, people with disabilities share many common concerns. They face 

personal, social and economic disadvantages and barriers that prevent access to the same 

opportunities as people without disabilities. People with disabilities continue, for example, to 

have lower education levels and to be socially isolated and discriminated against in the 

workplace. They often face economic hardship in their daily lives and far too many live below 

the poverty line. Women and people with disabilities from underrepresented groups and cultures, 

in particular, experience greater disadvantages, reporting higher incidences of unemployment 

and poverty. 

People with disabilities share many common aspirations for themselves and for their country. 

They want a nation which demonstrates leadership with respect to disability issues. Persons with 

disabilities desire a country that respects individual needs and ensures that they have input into 

the policies, programs and decisions that affect them. They seek a country which makes it 

possible to achieve a decent standard of living and support an approach to disability issues that is 

common to all jurisdictions but sensitive to regional differences and needs. People with 

disabilities want a nation that uses legal and other measures to promote social and economic 

equity and equality of outcomes. 

Through our work, NCD continually seeks to make those aspirations a reality. As the only 

agency in the Federal Government specifically tasked with considering and addressing the 

complete range of issues faced by all people with disabilities regardless of disability type or 

severity, NCD will be aggressive and resolute until the day arrives when people with disabilities 

in every corner of the world are no longer distinguished by a disability label.

We will use the vision, values and guiding principles we adopted, along with an improved 

statement of our mission, as we begin our journey down the pathway to our future. Our vision is 

supported by a set of strategic goals, strategies, objectives, actions and metrics designed to assure 

we are held accountable and that our activities are transparent to our stakeholders. 

Strategic Goals

Given the current economic and financial challenges facing the nation, it is of utmost importance 

that the Council operate as efficiently and effectively as possible to achieve its mission, while 

also complying with applicable laws and regulations and ensuring a sound internal control 

structure. Accordingly, NCD revised its Strategic Plan, and implemented new techniques to 

establish priorities, assign responsibility for executing them, and tracking them to completion.

The Strategic Plan forms the basis for each fiscal year’s annual operating plan and associated 

activities and requirements. The proposed Annual Operating Plan establishes the basis and 
Part I: Management's Discussion and Analysis

FY 2011 Performance & Accountability Report 7

justification for the Council’s Office of Management and Budget (OMB) and Congressional 

budget requests. When the annual appropriation is finalized and placed into law, the fiscal year 

Annual Operating Plan is adjusted as necessary and executed by staff. 

Together, these planning, execution, and review actions helped NCD to establish an 

organizational structure that best identifies and accomplishes priorities, while making the most 

efficient use of NCD’s limited resources. 

At the end of the fiscal year or at the conclusion of individual activities, staff evaluate program 

performance and resource utilization against the performance measures identified in the Strategic 

Plan and in the budget. These evaluations tell the Council how effective it has been and whether 

adjustments are needed in future program activities or resource allocations. 

Finally, the Council must be prepared to modify or change its planned direction or level of effort 

if factors not within its control change in unanticipated ways. Some of the factors that could 

materially affect the Council’s operations include:

 Legislation could be enacted that adds to or reduces NCD’s scope of authority or 

increases reporting requirements;

 Appropriations may be above or below the level requested; or

 Critical staff with hard-to-replace competencies may leave or be unable to work for 

some period of time.

There is still a great deal of effort needed to meet the goals and objectives set forth in the ADA 

and other pertinent Legislative and Executive Branch policies. NCD’s Strategic Plan for 2012-

2017 outlines the goals, strategies and actions to be employed to help NCD achieve its mission. 

The plan provides a pathway to the future that the Council believes will prove to have a positive 

impact on society.

Organizational Overview

Concurrent with the development of the Council’s Strategic Plan and the mid and short-term 

operational activities, staff determined the related resource requirements to carry out the 

proposed effort. The resource requirements include, among other things, staffing, IT, contractual, 

and ancillary needs. The anticipated resource requirements were reviewed for overall 

reasonableness and effectiveness before finalizing the Strategic Plan. The Council’s Strategic 

Plan and associated resource requirements were thoroughly vetted and approved by the Council 

members.

As a small agency, operating as a true policy Board, the Council sets the overall agency’s budget 

and establishes the parameters for what it will support. The Executive Director (ED), by 

delegation of the Council, serves as the Chief Operating Officer (COO) directing the effective 

and efficient allocation and use of resources and developing the management and administrative 

policy and programs of the Council. The ED’s responsibilities include management operations, 

legal, secretariat, human resources, financial management, information technology, and 
Part I: Management's Discussion and Analysis

FY 2011 Performance & Accountability Report 8

administration. The Executive Director supervises 11 full-time staff. NCD is organized into the 

following teams:

Policy & Legal Team 

The Policy & Legal Team analyzes federal laws, regulations, programs, policies, and case law

precedent; and proposes and develops NCD policy positions that have a national, state and 

international impact on the lives of people with disabilities.

Legislative Affairs & Outreach Team 

The Legislative Affairs & Outreach Team closely monitors Congressional activity on issues 

critical to the disability community and cultivates and maintains effective working relationships 

with NCD stakeholders at the federal, state, and local levels.

Finance, Operations & Administration Team 

The Operations & Administration Team provides critical staff support and monitors the agency's 

finance and accounting, information technology, and human resources management, as well as 

partners with the policy and outreach teams to build strategic relationships that are critical to the 

agency's work.

The current organizational structure provides for more delegation of authority than the previous 

flat organizational structure, consistent with NCD’s legislation. Accordingly, the lines of 

authority strengthen communication and enhance NCD’s operational efficiency and 

effectiveness.

National Council on Disability

Organizational Chart

December 2010

National Council on Disability 

Organizational Chart

Council Chair and 

Members

Executive Director

Director of Legislative 

Affairs and Outreach Director of Administration General Counseland Director of Policy

Attorney-Advisor

Policy Analyst

Attorney-Advisor 

(Staff Attorney)

Staff Assistant

Admin Assistant

Financial Management 

Analyst

Legis Affairs Specialist 

Public Affairs Specialist

Performance Goals, Objectives, and Results in Brief
Part I: Management's Discussion and Analysis

FY 2011 Performance & Accountability Report 9

The Council provides leadership in the disability policy arena by building on its traditions of 

innovation, objectivity, independence, and transcending disciplinary boundaries to meet the 

changing needs of society. Influencing the policy making process is important to NCD in the 

work that it conducts as an independent federal advisory agency.

Many NCD project and program activities reflect the expectation that the work it undertakes and 

supports will influence or have a positive impact on the policy process, and ultimately improve 

the quality of life and outcomes for people with disabilities. Within projects and programs, NCD 

members and staff link their activities to Federal Government and Congressional policy and the 

work undertaken and supported is often reported to have influenced the policy making process or 

enhanced decision makers’ awareness of policy. It is often the case that NCD engages in research 

and policy analysis that is cumulative in nature and its impact may not be measurable within any 

one fiscal year. Nonetheless, NCD works diligently to ensure its efforts have a positive influence 

and timely impact. The following provides a summary of NCD’s goal and objectives:

Strategic Goal: Advance the goals of the Americans with Disabilities Act by promoting policies, 

programs, practices, and procedures that guarantee equal opportunity and provide for economic 

self-sufficiency, independent living, and inclusion and integration into all aspects of society for 

individuals with disabilities.

Objective 1: Engagement -- Engage stakeholders in order to assess concerns and 

priorities and build a network of NCD partners.

 Creating and maintaining regular opportunities to receive direct input from community 

stakeholders.

 Cultivating trusted relationships with Congress.

 Establishing and cultivating trusted relationships with state, local, and tribal governments 

and other entities.

 Branding NCD as a principal national voice of the disability community.

Objective 2: Policy Development and Collaboration -- Address stakeholder concerns and 

priorities by advancing specific, practical policy solutions and encouraging 

collaboration.

 Cultivating trusted relationships with other federal agencies and looking for opportunities 

to coordinate and work collaboratively.

 Working closely with and enlisting the support of stakeholders to develop and advance 

policy responses to priority issues.

 Producing materials that have practical utility for federal, state, tribal, and local 

stakeholders regarding successful implementation of federal policies.

 Updating NCD’s annual progress report to be more responsive to Congress and the 

Administration.
Part I: Management's Discussion and Analysis

FY 2011 Performance & Accountability Report 10

Objective 3: Accountability -- Institute efficient and effective agency operations and systems 

to support the agency’s core mission.

 Recalibrating the Council’s operations.

 Evaluating and establishing effective agency operations and systems.

 Strengthening NCD’s financial management system. 

Management excellence is a key means to ensure that NCD achieves these objectives in the most 

efficient and effective manner. Consistent with the President’s Management Agenda (PMA), the 

Council is updating its human capital plan to better address the following elements: (1) strategic 

alignment; (2) leadership development; (3) knowledge transfer, and (4) results-oriented 

performance. In addition to investing in its people, the Council believes strong financial 

management and up-to-date technology are critical to supporting the mission and business 

operations, thereby ensuring that controls and systems meet applicable standards and can 

accommodate changes in stakeholder expectations and needs. 
Part I: Management's Discussion and Analysis

FY 2011 Performance & Accountability Report 11

See Section II below for further discussion of NCD’s performance goals, objectives and results.

Analysis of Financial Statements 

The Council prepares annual financial statements in accordance with U.S. generally accepted 

accounting principles (GAAP) for Federal government entities and subjects the statements to an 

independent audit to ensure their integrity and reliability in assessing performance. The financial 

statements and notes are presented on a comparative basis in the required format in accordance 

with OMB Circular No. A-136, revised, Financial Reporting Requirements.

The following table summarizes the significant changes in the NCD’s financial position during 

FY 2011:

Financial Condition FY 2011

Balance

FY 2010

Balance

Increase/

Decrease 

Percentage 

Difference

Total Assets $ 1,117,960 $ 1,711,213 Decrease 35%

Total Liabilities $ 373,570 $ 433,860 Decrease 14%

Net Position $ 744,390 $ 1,277,353 Decrease 42%

Net Cost of Operations $ 3,673,458 $ 3,340,387 Increase 10%

Budgetary Resources $ 3,897,002 $ 3,855,947 Increase 1%

Below is a brief description of the nature of each required financial statement and its relevance. 

Certain significant balances or conditions are explained to elaborate on the impact on the NCD’s 

operations. Readers are encouraged to gain a deeper understanding by reviewing the Council’s 

financial statements and notes to the accompanying audit report presented in the Financial 

Section of this report.

Balance Sheet

The Balance Sheet presents the total amounts available for use by the Council (assets) against the 

amounts owed (liabilities) and amounts that comprise the difference (Net Position). As a small 

independent agency, 100 percent of the NCD’s assets consist of Fund Balance with Treasury 

(FBWT). Fund Balance with Treasury represents NCD’s cash balances with the U.S. Treasury 

from which the Council is authorized to make expenditures and pay liabilities from operational 

activities. FBWT decreased by $624,736, or 36 percent, from FY 2010, largely due to 

obligations incurred in the fiscal year but not paid as of September 30, 2011. 

Statement of Net Cost

The Statement of Net Cost presents the annual cost of operating the Council’s programs. Gross 

costs less any earned revenue is used to arrive at the total net cost of operations. The Council’s 

total budget in FY 2011 was approximately $3.3 million. Overall, costs increased by 

approximately 10 percent, or $330,071. 

Approximately $1.7 million, or 52.0 percent, of the budget was dedicated to personnel costs. 

This amount is approximately 6.5 percent below budget due to the significant staff turnover that 
Part I: Management's Discussion and Analysis

FY 2011 Performance & Accountability Report 12

NCD encountered throughout FY 2011. The remaining costs were related to rent, financial 

management and information technology initiatives, and general operating expenses. 

To reduce duplication of administrative overhead in the Federal government, NCD depends on 

larger agencies to provide many of the support functions that are provided in-house by large 

agencies, it requires extreme vigilance to control costs and ensure that all needs and reporting 

requirements are being met. The Council uses the General Services Administration (GSA) to 

provide accounting, payroll, human resources, facilities management, and legal assistance. NCD 

also obtains support from the Department of Education for ethics and conflict of interest matters

on an as-needed basis, and to provide the required training to members and staff about their 

responsibilities as federal employees. Finally, the Government Printing Office provides printing 

services to NCD. The services provided by these agencies consume about 10 percent of the 

Council’s budget. 

Statement of Changes in Net Position

This statement presents in greater detail the net position section of the Balance Sheet, which 

includes Cumulative Results of Operations and Unexpended Appropriations. The statement 

identifies the activity that caused the net position to change during the reporting period. The total 

net position decreased by approximately $533,000.

Statement of Budgetary Resources

The Statement of Budgetary Resources provides information on the source and status of 

budgetary resources made available to the NCD during the reporting period. It presents the 

relationship between budget authority and budget outlays, as well as the reconciliation of 

obligations to total outlays. Total Budgetary Resources and Status of Budgetary Resources 

increased by approximately $41,000 or 1 percent, over FY 2010.

Analysis of Management Controls, Systems and Compliance

Federal Managers’ Financial Integrity Act (FMFIA)

NCD management is responsible for establishing and maintaining effective internal control and 

financial management systems that meet the objectives of the Federal Managers’ Financial 

Integrity Act (FMFIA) of 1982 as implemented by OMB Circular A-123, revised, Management’s 

Responsibility for Internal Control. The FMFIA requires federal agencies to provide an annual 

statement of assurance regarding management controls and financial systems. The objectives of 

the Council’s internal controls are to provide reasonable assurance that:

 Obligations and costs are in compliance with applicable laws;

 Assets are safeguarded against waste, loss, unauthorized use, or misappropriation;

 Revenues and expenditures applicable to Council operations are properly recorded and 

accounted for to permit the preparation of accounts and reliable to financial and statistical 

reports, and to maintain accountability over assets; and
Part I: Management's Discussion and Analysis

FY 2011 Performance & Accountability Report 13

 All programs are efficiently and effectively carried out in accordance with applicable 

laws and management policy.

Section 2 of the FMFIA requires federal agencies to report, on the basis of annual assessments, 

any material weaknesses that have been identified in connection with their internal and 

administrative controls. NCD conducted risk assessments and internal control reviews during FY 

2011, which resulted in an unqualified assurance that NCD’s systems and management controls 

comply with the requirements of the FMFIA. The Council has addressed a number of the 

weaknesses identified in FY 2010. The primary outstanding item, final documentation of 

policies and procedures, will be completed by March 31, 2012. Accordingly, NCD’s assurance 

on its control environment was unqualified based on the risk assessments and reviews and 

consideration of internal analyses, reconciliations and the findings identified in the Independent 

Auditor’s Report on Internal Control Over Financial Reporting, dated November XX, 2011. See 

pages XX through XX for the full report.

Section 4 of the FMFIA requires that agencies' financial management systems controls be 

evaluated annually. NCD evaluated its financial management systems for the fiscal year ending 

September 30, 2010 in accordance with the FMFIA and OMB Circular No. A-127, Financial 

Management Systems, as applicable. NCD uses GSA as its accounting service provider. GSA’s

financial management systems conform with the principles and standards required under Section 

4 of the FMFIA. Accordingly, NCD is able to provide reasonable assurance under Section 4 of 

the FMFIA.
 National Council on Disability

An independent federal agency making recommendations to the President and Congress

to enhance the quality of life for all Americans with disabilities and their families.

14

Chairman’s Statement of Assurance 

The Council’s management is responsible for establishing and maintaining effective internal 

control and financial management systems that meet the objectives of the Federal Managers’ 

Financial Integrity Act (FMFIA). 

The Council conducted its assessment of the effectiveness of internal control over the 

effectiveness and efficiency of operations and compliance with applicable laws and regulations 

in accordance with OMB Circular A-123, Management’s Responsibility for Internal Control. 

Based on the results of this evaluation, the Council can provide reasonable assurance that its 

internal control over the effectiveness and efficiency of operations and compliance with 

applicable laws and regulations as of September 30, 2011 was operating effectively and no 

material weaknesses were found in the design or operation of the internal controls. However, the 

on-going monitoring of internal control effectiveness has been identified as a significant 

deficiency. 

NCD has addressed all four material weaknesses reported for Fiscal Year (FY) 2010. Steps 

taken pursuant to an aggressive Corrective Action Plan have included: updating NCD Bylaws to 

establish an effective Audit and Finance Committee and undertaking a more comprehensive 

revision of the Bylaws to meet current agency needs; adopting a comprehensive Audit and 

Finance Committee Charter to ensure that the committee fulfills the functions needed to protect 

the agency; approving NCD’s first five-year Strategic Plan in accordance with OMB Circular A11 Section 210; conducting a risk assessment based on a newly developed risk assessment tool 

and taking actions necessary to reduce risks identified through the assessment; identifying 

critical areas for staff training and commencing the training; enhancing period-end financial

close and reporting processes; enhancing the effectiveness and efficiency of Council governance 

and oversight through the establishment of standing committees for Policy & Program 

Evaluation and Governance & Planning in addition to the Audit & Finance Committee, as well 

as a repurposed Executive Committee; and revised its organizational structure, including 

documenting roles and responsibilities for all critical agency functions. 

As part of its revised organizational structure, NCD has established two new positions needed to 

assure that our internal control environment and financial management systems meet the 

objectives of FMFIA. NCD has begun the hiring process by working with the General Services 

Administration to classify the positions and post them on USAJOBS, the United States 

government's one-stop clearinghouse for civil service job opportunities with federal agencies, 

with a goal of filling positions filled by the end of the calendar year. In addition, NCD will 

finalize our policy and procedures surrounding the period-end financial close and reporting 

processes by March 31, 2012.
 National Council on Disability

An independent federal agency making recommendations to the President and Congress

to enhance the quality of life for all Americans with disabilities and their families.

15

While the on-going monitoring of internal control effectiveness has been identified as a 

significant deficiency in FY 2011, NCD took steps to confront the FY 2010 material weaknesses 

that can be utilized to address the significant deficiency.

Based on our assessment, we have determined that the Council’s financial management systems 

are now positioned to conform to applicable financial systems requirements.

Jonathan Young, Ph.D., J.D.

Chairman

November 15, 2011
Part II: Performance Section

16

Prompt Payment Act

The Prompt Payment Act requires federal agencies to make timely payments to vendors, 

including any interest penalties for late invoice payments. In FY 2011, the NCD paid an 

immaterial amount in interest penalties on invoices processed.

Federal Financial Management Improvement Act (FFMIA)

Agencies subject to the Accountability of Tax Dollars Act (ATDA) of 2002 are not subject to the 

requirements of FFMIA. Accordingly, NCD is not subject to the requirements of FFMIA. 

Improper Payments Elimination and Recovery Act 

The Improper Payments Information Act (IPIA—P.L. 107-300) requires federal agencies to 

identify and report on significant payment programs that are susceptible to improper payments. 

The Act defines significant improper payments as those within a single payment program that 

exceed both 2.5 percent of that program’s annual amounts paid and $10 million annually. The 

Improper Payments Elimination and Recovery Act of 2010 (IPERA), enacted on July 22, 2010, 

requires the development of policies and procedures for the prevention and detection of improper 

payments in the federal government. The Act expands on the Improper Payments Information 

Act of 2002 (IPIA), which requires an initial assessment to identify those programs that are 

susceptible to significant risk of improper payments. ―Significant,‖ as defined in the Act, means 

that in the preceding fiscal year, improper payments in the program or activity may have 

exceeded $10,000,000 of all program or activity payments made during that fiscal year reported 

and 2.5 percent of program outlays; or $100,000,000.

NCD does not have any programs where significant erroneous payments have occurred within 

the agency. The Council will continue to review its financial operations on an annual basis to 

determine if any significant erroneous payments exist.

Limitations of the Financial Statements

The principal financial statements have been prepared to report the financial position and results 

of operations of the Council, pursuant to the requirements of 31 U.S.C. 3515 (b). While the 

statements have been prepared from the books and records of the Council in accordance with 

U.S. generally accepted accounting principles (GAAP) for federal entities and the formats 

prescribed by OMB, the statements are in addition to the financial reports used to monitor and 

control budgetary resources, which are prepared from the same books and records. 

The statements should be read with the realization that they are for a component of the U.S. 

Government, a sovereign entity.

NCD has a unique mission among federal agencies because it is charged with reviewing all 

programs and policies across the federal government, not merely one aspect of policy affecting 

people with disabilities. While the Council’s independent status allows NCD to provide an 

unbiased overview of many of those agency services and programs, it is the nature of NCD’s 
Part II: Performance Section

17

overview and recommendations that make NCD’s work so important in the eyes of those who 

eventually benefit when those recommendations are acted upon by those who have the power to 

do so. 

The Council produces information critical to improving the delivery of programs to individuals

with disabilities. The Council’s series of reports and papers study a broad array of disabilityrelated laws and programs and has resulted in or documented the need for ongoing changes to 

many of the services needed to sustain the health and independence of our most vulnerable 

citizens. These reports can be found at http://www.ncd.gov/publications. In addition, as related 

below, NCD has been given substantial responsibilities for disability-related issues in the 

nationwide effort to improve emergency preparedness and enhance homeland security.

Performance by Strategic Goals

The Council’s Strategic Plan links the agency’s funding to its goals and accomplishments and 

demonstrates NCD’s continued commitment to shaping and preserving a complex framework of 

policies and programs that serve and support people with disabilities nationwide. The following 

is a summary of the results NCD attained, as related to its operations and framed under the draft 

FY 2011 Strategic Plan.

Strategic Goal: Advance the goals of the Americans with Disabilities Act by 

promoting policies, programs, practices, and procedures that guarantee equal 

opportunity and provide for economic self-sufficiency, independent living, and 

inclusion and integration into all aspects of society for individuals with 

disabilities.

Objective 1: Engagement -- Engage stakeholders in order to assess concerns and 

priorities and build a network of NCD partners.

NCD’s stakeholders include all people with disabilities; policymakers and decision makers; 

groups and organizations concerned with people with disabilities; families and support systems 

of people with disabilities; and society at large. Given the diversity of the agency’s stakeholders, 

NCD has employed a variety of engagement methods in the last year, which have enabled NCD 

to capture real-time, on-the-ground snapshots of individuals’ and community’s challenges, 

priorities, and emergency needs, which in turn informs NCD’s policy development and 

collaboration (Objective 2). 

In the last fiscal year, NCD held two regional policy forums, in engaging 155 individuals 

representing advocacy organizations, service providers, self-advocates, state agencies, and 

federal partners. The first regional forum, NCD’s ―Earning‖ Forum, held in Detroit, Michigan, 

October 25 – 27, 2010, created a venue through which NCD engaged and received valuable 

regional information about the experiences of stakeholders from Michigan, Ohio, Illinois, 

Indiana, Wisconsin, and Minnesota pertaining to Vocational Rehabilitation and One-Stop

Centers, community-based employment, asset development, and innovative state and local 

partnerships that pool resources for greater yields. 
Part II: Performance Section

18

The second regional forum, NCD’s ―Living‖ Forum, held in Portland, Oregon, May 5-6, 2011, 

gave participants an opportunity to present and constructively discuss challenges and best 

practices related to community living systems change for people with disabilities. Stakeholders 

from Oregon, Washington, California, Nevada, and Idaho examined various state and local 

experiences using litigation, legislation, and community partnerships to improve independent, 

community living. The forum also examined the issues of safeguarding the rights of parents with 

disabilities and improving the interactions between law enforcement and people with disabilities. 

At the end of the forum, NCD held a town hall, at which approximately 50 individuals provided 

comments about the effects of budget cuts on community living for people with disabilities, the 

availability of affordable, accessible, integrated housing, transition experiences of people with 

disabilities joining or rejoining the community, and a variety of other personal and professional 

experiences related to community living.

Over the last fiscal year, NCD also held six public meetings: December 2-3, 2010; March 10-11, 

2011; May 19, 2011; June 28, 2011; July 22, 2011; and September 7, 2011. All of the meetings 

took place in Washington, DC or via conference call. NCD’s public participation at these 

meetings remained low throughout the fiscal year, with fewer than five individuals joining each 

time. However, this is perhaps unsurprising given the subject matter of these meetings, which by 

and large reflected an inward planning focus of the agency during development and early 

implementation of the strategic plan and agency staff and Council changes. NCD remains 

committed to strengthening its public participation at its meetings and believes an anticipated 

greater focus on the policy work of the agency in FY 2012 will aid in gaining the public’s greater 

interest. 

These events have generated several outcomes and projects on both the state and local level. 

Owing to the ―Earning‖ forum that took place in Detroit Vocational Rehabilitation agencies in 

Michigan, Ohio, Illinois, Indiana, Wisconsin, and Minnesota are now meeting periodically to 

discuss job training for people with disabilities and to brainstorm over problems that the agencies 

face. Officials in Ohio held a state-based ―Earning‖ forum in April 2011 to discuss state issues. 

NCD’s Chair participated in the event. A panel discussion at the ―Living‖ forum in Portland 

identified numerous discriminatory state laws and practices carried out by child welfare agencies 

and family courts that have caused parents with disabilities to lose legal custody of their children. 

NCD has started new work that advances the goals of the Americans with Disabilities Act by 

safeguarding the rights of parents with disabilities. At the December Council meeting the perils 

of travelers with disabilities at airport security screenings was discussed. Council members 

expressed strong support in working with Transportation Security Administration (TSA) to 

eliminate such problems. A meeting with TSA ensued and as a result of our meeting TSA’s 

Office of Disability Policy and Outreach formed an Integrated Product Team to conduct an 

extensive review of the Screening Checkpoint Standard Operating Procedures sections that apply 

to people with disabilities and medical conditions.

In addition to its meetings and forums, NCD also entered social networks in the last fiscal year 

by establishing both a Facebook and Twitter presence, which both enjoy healthy and growing 

numbers of followers. These new extensions of the agency’s online presence have created 

additional venues for engaging and collecting critical stakeholder opinions and experiences about 

current policy developments. 
Part II: Performance Section

19

NCD’s stakeholder engagement also included enhanced efforts aimed at strengthening its 

relationships with Congress as a trusted, independent, nonpartisan authority regarding the 

challenges, priorities, and emergent needs of the disability community. As a result of this work 

on May 12, 2011, NCD held a public Congressional Forum that examined ―Disability in the 

Budget: Why It Matters‖ in the Rayburn House Office Building in Washington, DC. The forum 

represented the first of its kind in the agency’s history. Congresswoman Cathy McMorris 

Rodgers (R-WA) and Congressman James Langevin (D-RI) testified, as did Under Secretary 

Kevin Concannon of the U.S. Department of Agriculture. Ms. Kelly Stuart Woodall, Executive 

Director of the Association of Self-Advocates of North Carolina; Mr. Ed Lorenzen, Executive 

Director of The Moment of Truth Project of the Committee for a Responsible Federal Budget; 

and Ms. Bonnie Miller, a parent and coordinator of the Pennsylvania Self-Determination 

Consumer and Family Group also provided testimony. The forum generated considerable interest 

and was well-attended by Congressional staff, advocates, and members of the public. NCD 

received several written submissions to the record of the forum after the event, as well. NCD has 

used ideas from our reports, generated through the Congressional forum, and written testimony 

submitted to the record in subsequent discussions with Congressional staff about budgetary 

issues and programs that affect people with disabilities. Furthermore, Senator Harkin (D-IA) and 

Representative McMorris Rogers (R-WA), co-authored an op-ed on Olmstead, citing a number 

of data points that NCD used in the briefing.

In addition to NCD holding its own Congressional Forum on Capitol Hill and because of our 

enhanced efforts to strengthen relationships with Congress, on September 15, 2011, NCD 

Chairman Jonathan Young was invited to testify before the Senate Health Education Labor and 

Pensions Committee in a roundtable discussion titled ―The Future of Employment for People 

with the Most Significant Disabilities.‖ Furthermore, NCD has been asked by several 

Congressional staff to identify witnesses to testify at hearings including: the Senate Health 

Education Labor and Pensions Committee, Special Committee on Aging, and Senate Homeland 

Security and Governmental Affairs Committee.

In addition to ongoing congressional liaising with individual and committee offices, NCD has 

also continued to enjoy a strong relationship with the Bipartisan Disabilities Caucus, co-chaired 

by Representatives Jim Langevin (D-RI) and Cathy McMorris Rodgers (R-WA). On June 21, 

2011, NCD co-hosted a congressional briefing with the Bipartisan Disabilities Caucus titled 

―The 12th Anniversary of the Olmstead Decision: The Role of Home and Community-Based 

Services in Health Care,‖ which provided an opportunity for congressional staff to learn the 

history of the Olmstead decision, the evolution of home- and community-based services under 

programs like Medicaid, and opportunities and challenges of providing these services in the 

current budgetary environment. Henry Claypool, Director of the Office on Disability (U.S. 

Department of Health and Human Services); Jennifer Mathis, Deputy Legal Director of the 

Bazelon Center for Mental Health Law; and Nancy Thaler, Executive Director of the National 

Association of State Directors of Developmental Disabilities Services (NASDDDS) presented. 

NCD has also continued to place an emphasis on stakeholder input from traditionally 

underserved populations. Through its Tribal Consultation Workgroup, NCD continued to work 

with leaders at the Consortia of Administrators of Native American Rehabilitation, utilizing 
Part II: Performance Section

20

phone and in-person meetings to facilitate dialogue that yielded input and perspectives on 

matters affecting the lives of tribal people with disabilities. 

NCD also sought to establish and deepen agency relationships with several key state government 

membership groups. During the fiscal year, NCD invited representatives of the National Council 

on State Legislatures (NCSL), the Council of State Governments (CSG), and the National 

Governors’ Association (NGA) to speak and participate in regional forums. NCD Members also 

attended several of their events, as well. 

Objective 2: Policy Development and Collaboration -- Address stakeholder concerns and 

priorities by advancing specific, practical policy solutions and encouraging collaboration 

NCD gathers information from the public through a number of means: public testimony at 

meetings either in person or on toll-free phone lines, electronic mail, comments received through 

NCD’s social networking sites, letters of concern from members of the public, formal public 

consultations utilizing the Internet in order to provide advice on reports underway at NCD, 

information gathered in the preparation of NCD reports, interaction between NCD Council 

Members and staff at conferences and meetings of stakeholder groups, and during sessions where 

NCD is releasing its reports.

During FY2011, NCD commissioned and developed several reports, papers and briefs. The 

information gathered during the preparation of these reports and during NCD’s periodic meetings 

is typically used by the Council to develop policy recommendations that are shared with 

Congress and the President through the mentioned reports and papers, as well as the NCD’s 

annual progress report or as needed during discussions about pending legislation. During FY11, 

NCD completed or released reports on the following subjects:

Rising Expectations: The Developmental Disabilities Act Revisited -- In FY10, NCD conducted 

a year-long study of how well the set of programs established under the Developmental 

Disabilities Assistance and Bill of Rights Act (Developmental Disabilities Act), last reauthorized 

in 2000, are meeting the needs of people with developmental disabilities and their families. This 

report presents the findings and offers recommendations for changes to help develop a more 

uniform national policy that will support the goals of the Developmental Disabilities Act and 

improve the program supports and services for people with developmental disabilities.

On October 6, 2010, NCD co-hosted a congressional staff briefing with staff of the House 

Energy and Commerce Subcommittee on Health regarding this report, at which the findings and 

recommendations of the report were highlighted and Commissioner Sharon Lewis of the 

Administration on Developmental Disabilities responded and presented. The briefing was wellattended by legislative staff of the House Energy and Commerce Committee, House Education 

and Labor Committee, and staff of members of the Bipartisan Disabilities Caucus. 

NCD held the official release of this report in coordination with the Disability Policy 

Collaboration on February 14, 2011. 
Part II: Performance Section

21

National Disability Policy: A Progress Report -- NCD has overhauled the agency’s mandated 

annual Progress Report. In 2008, NCD released a report titled ―Keeping Track: National 

Disability Status and Program Performance Indicators‖ which recommended the development of 

a social indicator system that would measure the status of people with disabilities in the United 

States. This type of indicator system would fill a major gap in the disability literature, providing 

a comprehensive picture of the well-being of people with disabilities and the gaps in this wellbeing as compared to people without disabilities. In 2008, the Government Accountability Office 

(GAO) also recommended that the Federal Government create a common set of outcomes that 

will measure the status of people with disabilities and progress toward achieving program goals. 

In 2009, based on the 2008 NCD report, the National Institute on Disability and Rehabilitation 

Research (NIDRR) at the U.S. Department of Education drafted an un-published report titled 

―The State Of Disability in America: 2009 Status Report.‖ The report presented the most recent 

data for a set of social indicators measuring the quality of life of people with disabilities in the 

United States. The indicators covered a variety of social domains and were designed to compare 

the status of people with disabilities to those without disabilities. The domains included in the 

indicator set were comprised of: employment, education, housing, health, finances, community 

participation, and crime and safety. In FY 2011, NCD, NIDRR, and American Institutes for 

Research (AIR) collaborated on updating the NIDRR indicators to use in NCD’s revamped 

annual progress report, providing a significant discussion of the overall state of disability in 

America. The indicators were used in conjunction with information gleaned through NCD’s 

summits, forums, listening sessions, and workgroups to address the policies affecting the 

disability community and compliment the indicators.

NCD’s FY 2011 annual progress report was be released in early FY2012. But unlike past years 

it is important to note that the revamped report will highlight policy successes and failures 

throughout the year, and the need for continuing emphasis on the implementation of federal laws, 

rules, and programs affecting the disability community. NCD believes that the FY 2011 annual 

progress report will be a model report for FY 2013 and years to come.

NCD briefed Congressional staff, via conference call, on the report and received very positive 

results. During the call staff requested specific information related to Medicaid and the Federal 

Medicaid Assistance Percentage (FMAP). Additionally, after the call staff followed-up with 

questions regarding the Social Security Disability Insurance program. 

Briefing Paper: "Bullying and Students with Disabilities" -- NCD also continued to develop 

and release policy papers and reports, while also identifying new areas of focus. Since its 

inception, NCD has been viewed by the disability community, congressional leaders, various 

administrations, and organizations in the public as a trusted source and leader in the disability 

arena. In December 2010, NCD responded to a White House request for a white paper focusing 

on the bullying of people with disabilities for a White House conference on bullying. NCD’s 

renewed focus on rapid policy development facilitated the development and submission of the 

paper within a one month time frame. The paper was so well-received that NCD was asked by 

the White House for assistance in identifying potential participants at the White House 

conference on bullying as well as tasked to work with the Department of Education on antibullying initiatives. 
Part II: Performance Section

22

In FY 2011, NCD also completed an additional three policy reports, which will be released in 

FY2012: 

Towards the Full Inclusion of People with Disabilities: Examining the Accessibility of 

Overseas Facilities and Programs Funded by the United States -- The report examines the work 

of USAID, the U.S. Department of State (DOS), and the U.S. Department of Defense (DOD), 

and provides recommendations that will strengthen the operation of these agencies. It reviews 

U.S. federal disability laws, the United States Agency for International Development’s (USAID) 

disability policy, and the Convention on the Rights of Persons with Disabilities (CRPD) and 

discusses their application to U.S. foreign assistance programs with the goal of ensuring the 

accessibility and inclusion of people with disabilities in foreign assistance programs funded by 

the United States. The Senate Armed Services Committee is every interested in this report given 

the number of bases that they have internationally and have requested a briefing when the report 

is available.

The Power of Digital Inclusion: Technology’s Impact on Employment and Opportunities for 

People with Disabilities -- This report examines the importance of social media and other 

information technologies in connecting people to job opportunities. The recommendations 

contained in this report are designed to open the doors to digital technologies that can lead to 

better jobs for more people with disabilities. 

U.S. Marine Corps Exceptional Family Members: How to Improve Access to Health Care, 

Special Education, and Long-Term Supports and Services to Family Members with 

Disabilities. -- At the request of the U.S. Marine Corps, NCD conducted a study to 

systematically examine the challenges experienced by Marine families that include family 

members with disabilities and to identify steps toward ameliorating these challenges. This report 

documents the experiences of USMC families with members with disabilities in accessing 

appropriate and effective services in health care, special education and related services, and longterm supports and services; identifies barriers impeding access to appropriate resources; and 

develops recommendations to improve access. NCD is currently working with the Senate Armed 

Services Committee as well as several other Congressional offices on strategies to enhance the 

visibility of the report and on working with the other branches of the military on similar reports 

or to implement the recommendations suggested in the report.

NCD also continued its work on two other policy reports, which will be completed in FY2012: 

The Case for Deinstitutionalization: Unfinished Business; and Exploring New Paradigms for the 

Developmental Disabilities and Bill of Rights Act. 

During FY2011, we also began work in two other policy areas: protecting the parenting rights of 

people with disabilities; and a cooperative agreement with The National Association of State 

Directors of Developmental Disabilities Services (NASDDDS) on the impact of Medicaid 

managed care for people with disabilities. 

Health Care Reform Implementation -- NCD is also continuing our work to strengthen access 

to and improve the quality of health care for people with disabilities. With the new health care 
Part II: Performance Section

23

reform law NCD must focus on health care reform implementation assuring that areas such as 

disparities in health care that impact people with disabilities and others appropriately address the 

needs of this important segment of the population. To achieve these goals NCD has been 

working with several stakeholders to study the Administration’s implementation of the Patient 

Protection and Affordable Care Act (PPACA) to assure that the needs of people with disabilities 

are addressed consistently throughout the law. NCD sent letters to the Health Resources and 

Services Administration (HRSA) and the Centers for Disease Control and Prevention at the U.S. 

Department of Health and Human Services, offering assistance, in a technical advisory capacity 

on ways in which NCD can assist the two agencies implement provisions of PPACA that fall 

under their purview. Based on that outreach HRSA and NCD have been meeting on policy 

matters including how to address the needs of people with disabilities in grant awards for 

prevention programs, primary care services, and the development of the health professions 

workforce.

Air Travel of People with Disabilities -- Furthermore, based upon the negative experiences of 

travelers with disabilities at airport security checkpoints NCD has also reached out to the 

Transportation Security Administration (TSA) offering our assistance, in a technical advisory 

capacity, regarding security screenings of passengers with disabilities and specifically the need 

for a universal design-based solution for the screening of all passengers. As a result of our 

meeting with TSA’s Office of Disability Policy and Outreach, TSA formed an Integrated Product 

Team to conduct an extensive review of the Screening Checkpoint Standard Operating 

Procedures sections that apply to people with disabilities and medical conditions. Additionally, 

they are collaborating with TSA’s Office of Technical Training on a complete redesign of the 

training curriculum for same.

No Child Left Behind Waivers -- After the U.S. Department of Education announced its 

intention to offer waivers to states to key provisions of the No Child Left Behind Act (NCLB) in 

return for state adoption of various college- and career-ready standards and teacher evaluations, 

NCD was quick to meet with key leadership in the Department, including Secretary Arne 

Duncan and Assistant Secretary for Special Education and Rehabilitative Services Alexa Posny, 

as well as majority and minority staff in the Senate Health Education Labor and Pensions 

Committee. Following those constructive meetings, NCD issued a letter to Secretary Duncan, 

supporting the notion of ―flexibility for reform‖ but entreating the Department to ensure that the 

flexibility not compromise the accountability provisions, teacher quality provisions, and data 

subpopulation disaggregation by which students with disabilities have made great strides under 

NCLB. NCD has reached out to several groups to develop a technical assistance circular for 

states that provides guidance on disability specific items that states should include in their waiver 

application. 

Judge Rotenberg Center (JRC) -- In light of the effect on children and youth and with 

disabilities nationwide, NCD sent a letter to the Massachusetts DDS Commissioner urging 

elimination of aversives – the only known school in the United States to provide such treatment. 

Students from an estimated 17 other states and the District of Columbia attend JRC and are 

therefore potential recipients of such aversive treatments. As such, NCD views this as a 

significant issue of national importance. http://www.ncd.gov/publications/2011/July182011
Part II: Performance Section

24

Limited English Proficiency Plan -- NCD submitted its annual Limited English Proficiency 

Plan, highlighting its commitment to meaningful access. NCD review its LEP plan at least 

annually, including the provisions of opportunity for external stakeholder input. NCD will 

continue its work to address the inadequacies and unique needs of people who are culturally 

diverse and have LEP, and work for their meaningful inclusion into our society. 

http://www.ncd.gov/publications/2011/LEP2011

Emergency Management -- Prior to the catastrophic hurricanes of 2005 (Katrina and Rita) 

NCD heard from the disability community of their safety concerns should a national disaster 

occur in the United States. In April of 2005 NCD released Saving Lives: Including People with 

Disabilities in Emergency Planning. Based on that work, NCD received additional funding 

through the Post-Katrina Emergency Management Reform Act of 2006 (PKEMRA) to continue 

our emergency preparedness efforts for people with disabilities. In FY2011, NCD collaborated 

with the Federal Emergency Management Agency (FEMA) Office of Disability Integration and 

Coordination on an inclusive emergency preparedness conference, Getting Real II, and held a 

webcast of the conference that was enthusiastically well-received. In addition to the 400 

attendees (who came from 37 states and Guam) at the conference, 2,826 people visited the 

webcast, with 80 percent coming via direct traffic and 10 percent international traffic primarily 

from Japan, Canada, Germany and the United Kingdom along with participants from the African 

continent.

From NCD’s review of the Summit activities and national dialogue, its Board deliberations, and 

the activities and accomplishments highlighted in NCD’s Annual Progress Report, NCD believes 

policies can and will be underpinned by a more integrated and coordinated approach to 

government programs. Importantly, the approach will recognize not only the complexity of 

implementing disability policies, but also the intricacies of people’s lives and the intersection and 

interdependence of the many programs needed to address those lives.

United States Agency for International Development (USAID) -- After the triple disaster in 

Japan, NCD issued a letter to the Administrator of USAID highlighting the critical need for 

USAID to organize a response that fully addresses the needs of people with disabilities that 

builds on USAID's prior efforts. We urged USAID to build on the lessons learned in Haiti and 

reach out to its government and non-governmental partners in mounting a response. 

http://www.ncd.gov/publications/2011/March212011

Objective 3: Accountability -- Institute efficient and effective agency operations and systems 

to support the agency’s core mission.

The Council places a high priority on ensuring the effective use of technology and internal 

procedures to optimize its operations. Management excellence is a key strategy by which the 

Council strives to ensure its mission is in the most efficient and effective manner. Consistent 

with the President’s Management Agenda (PMA), the Council is updating its human capital plan 

to better address the following elements: (1) strategic alignment; (2) workforce planning; (3) 

leadership development; and (4) knowledge transfer and results-oriented performance.

Furthermore, the Council believes that, in addition to investing in its people, strong financial 

management and up-to-date technology are critical means to achieving its mission. Accordingly, 
Part II: Performance Section

25

NCD continues to improve its programs and operations, strengthening internal controls, financial 

management, and information technology across the agency. 

For example, during FY 2011, NCD:

 Updated its strategic plan.

 Restructured its organization structure from a horizontal organization to a hierarchical 

organization to enhance communication.

 Contracted with a federal financial management expert.

 Continued to update policies and procedures, and performance management system to 

ensure that staff understands their role and responsibilities.

 Continued to assess its information technology infrastructure, including identifying 

enhancements relating to risk assessments of operations, disaster recovery, continuity of 

operations and accessibility.

 Upgraded its website to make information more accessible and proactively available to 

the public in support of the Administration’s initiative for more transparency.

 Implemented a ―Facebook‖ page that encourages an open dialogue, further expanding its 

outreach and collaborative efforts with its stakeholders.

 Identified training needs of its staff.

NCD recognizes the progress it has made and the accomplishments achieved by its staff to 

enhance the efficiency of its operations. However, NCD recognizes more progress is needed. 

NCD will continue to focus on resolution of issues identified in audits, establishing sound 

policies and procedures, focusing on the relationship between budget and performance, 

maximizing use of staff and financial resources, and training NCD staff on responsible financial 

operational processes.
Part III: Financial Section

FY 2011 Performance & Accountability Report 26

Message From the Executive Director

I am pleased to report that for the fifth consecutive year, the Council earned an unqualified 

―clean‖ audit opinion on its consolidated financial statements. As noted in the Chairman’s 

Statement of Assurance, during Fiscal Year (FY) 2010 the Council encountered several issues 

that adversely impacted its internal control, which ultimately led to the identification of four 

material weaknesses. 

However, in FY 2011 NCD took aggressive steps through a Corrective Action Plan to address 

the material weaknesses including: updating NCD Bylaws to establish an effective Audit and 

Finance Committee and adopting a comprehensive Audit and Finance Committee Charter to 

ensure that the committee fulfills the functions needed to protect the agency; approving NCD’s 

first five-year Strategic Plan in accordance with OMB Circular A-11 Section 210; conducting a 

risk assessment based on a newly developed risk assessment tool and taking actions necessary to 

reduce risks identified through the assessment; identifying critical areas for staff training and 

commencing the training; enhancing period-end financial close and reporting processes; 

enhancing the effectiveness and efficiency of Council governance and oversight through the 

establishment of standing committees for Policy & Program Evaluation and Governance & 

Planning in addition to the Audit & Finance Committee, as well as a repurposed Executive 

Committee; and revised its organizational structure, including documenting roles and 

responsibilities for all critical agency functions. 

The Council recognizes that its work is not done. The on-going monitoring of internal control 

weakness has been reported as a significant deficiency. The agency will take the necessary 

action to address the significant deficiency including finalizing our policy and procedures 

surrounding the period-end financial close and reporting processes by March 31, 2012, and 

utilizing tools such as our risk assessment developed to address the material weaknesses 

identified in FY 2010 and linking it to the monitoring of internal controls. NCD made financial 

management a priority in FY 2011 and is committed to ensuring it has the organization, systems, 

and resources to sustain an unqualified opinion in future years.

Finally, I want to take this opportunity to acknowledge the efforts of the Council and entire staff 

that made our financial management a priority during FY 2011. The unqualified opinion is fully 

attributable to their dedication and commitment to quality financial management.

Aaron Bishop

Executive Director
Part III: Financial Section

FY 2011 Performance & Accountability Report 27

The final portion of the PAR includes our independent auditor’s report. In summary for the 

Fiscal Year that ended September 30, 2011 and 2010 the Council’s auditors found:

 The financial statements are presented fairly, in all material respects, in conformity with 

U.S. generally accepted accounting principles.

 No material weaknesses in internal control over financial reporting (including 

safeguarding assets) in FY 2011, however, we did identify one matter that we consider to 

be a significant deficiency in internal control over financial reporting. During FY 2010 

we identified four matters that we considered to be material weaknesses in internal 

control over financial reporting.

 No reportable noncompliance with laws and regulations we tested.
NATIONAL COUNCIL ON DISABILITY

GENERAL FUND

FINANCIAL STATEMENTS

As Of And For The Years Ended September 30, 2011 & 2010
TABLE OF CONTENTS 

Independent auditor’s report................................................................................... 1-4 

Balance sheets.................................................................................................. 5 

Statements of net cost ................................................................................... 6 

Statements of changes in net position..................................................................... 7-8 

Statements of budgetary resources......................................................................... 9 

Notes to financial statements................................................................................... 10-24 

Appendix A: National Council on Disability Comments on Draft Audit Report 

Appendix B: Notice of Findings and Recommendations and Management Responses 
 

Independent Auditor’s Report

Chairman, Executive Director and Council Members 

National Council on Disability 

Washington, DC 

In accordance with the Accountability of Tax Dollars Act of 2002, we are responsible for conducting audits 

of the National Council on Disability. We have audited the accompanying balance sheets of the National 

Council on Disability as of September 30, 2011 and 2010 and the related statements of net cost, changes 

in net position, and budgetary resources for the years then ended. 

The objective of our audits was to express an opinion on the fair presentation of these financial 

statements. In connection with our audits, we also considered the National Council on Disability’s internal 

control over financial reporting and tested the National Council on Disability’s compliance with selected 

provisions of applicable laws and regulations that could have a direct and material effect on these 

financial statements. 

Summary

In our audits of the National Council on Disability for the fiscal years ended September 30, 2011 and 

2010, we found: 

• The financial statements are presented fairly, in all material respects, in conformity with U.S. 

generally accepted accounting principles. 

• No material weaknesses in internal control over financial reporting (including safeguarding 

assets) in FY 2011, however, we did identify one matter that we consider to be a significant 

deficiency in internal control over financial reporting. During FY 2010 we identified four matters 

that we considered to be material weaknesses in internal control over financial reporting. 

• No reportable noncompliance with laws and regulations we tested. 

The following sections discuss our opinion on the Council’s financial statements; our consideration of the 

Council’s internal controls over financial reporting; our tests of the Council’s compliance with certain 

provisions of applicable laws, regulations, contracts and agreements; and management’s and our 

responsibilities. 

Opinion on Financial Statements

We have audited the accompanying balance sheets of the National Council on Disability as of September 

30, 2011 and 2010 and the related statements of net cost, changes in net position, and budgetary 

resources for the years then ended. 
2 

In our opinion, the financial statements referred to above, including the accompanying notes, present 

fairly, in all material respects, the financial position of the National Council on Disability, as of September 

30, 2011 and 2010, and its net costs, changes in net position, and budgetary resources for the years then 

ended, in conformity with U.S. generally accepted accounting principles. 

The information in the Management’s Discussion and Analysis, Required Supplementary Stewardship 

Information and Required Supplementary Information sections is not a required part of the financial 

statements, but is supplemental information required by U.S. generally accepted accounting principles. 

We have applied certain limited procedures, which consisted of principally inquiries of management 

regarding the methods of measurement and presentation of this information. However, we did not audit 

this information and, accordingly, we express no opinion on it. 

Internal Control Over Financial Reporting

A deficiency in internal control exists when the design or operation of a control does not allow 

management or employees, in the normal course of performing their assigned functions, to prevent, or 

detect and correct misstatements on a timely basis. A material weakness is a deficiency, or combination 

of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement 

of the entity’s financial statements , fraud or noncompliance in amounts that would be material to the 

financial statements will not be prevented, or detected and corrected on a timely basis. 

Our consideration of internal control over financial reporting was for the limited purpose described in the 

Responsibilities section and was not designed to identify all deficiencies in internal control over financial 

reporting that might be deficiencies, significant deficiencies, or material weaknesses. In our fiscal year 

2011 audit, we did not identify any deficiencies in internal control over financial reporting that we consider 

to be material weaknesses, as defined above. However, we identified certain deficiencies in internal 

control over financial reporting, described in Appendix B-Notice of Findings and Recommendations and 

Management Responses, that we consider to be significant deficiencies in internal control over financial 

reporting: NFR 11-01 Ineffective Monitoring of Internal Control Effectiveness. 

We noted certain additional matters that we reported to the Council’s management addressing internal 

control matters. 

Compliance and Other Matters

The results of our tests of compliance as described in the Responsibilities section of this report disclosed 

no instances of noncompliance or other matters that are required to be reported herein under 

Government Auditing Standards or OMB Bulletin No. 07-04, as amended. 

Responsibilities

Management Responsibilities: National Council on Disability’s management is responsible for (1) 

preparing the financial statements in conformity with U.S. generally accepted accounting principles, (2) 

establishing and maintaining effective internal control, (3) complying with laws, regulations, contracts and 

agreements applicable to the Council. 

Auditor’s Responsibilities: Our responsibility is to express an opinion on the fiscal years 2011 and 2010 

financial statements of the National Council on Disability based on our audits. We conducted our audits 

in accordance with auditing standards generally accepted in the United States of America; the standards 

applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller 

General of the United States; and OMB Bulletin No. 07-04, as amended. Those standards and OMB 

Bulletin 07-04, as amended, require that we plan and perform the audit to obtain reasonable assurance 

about whether the financial statements are free of material misstatement. An audit includes consideration 
3 

of internal control over financial reporting as a basis for designing audit procedures that are appropriate in 

the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the National 

Council on Disability’s internal control over financial reporting. Accordingly, we express no such opinion.

An audit also includes: 

• Examining, on a test basis, evidence supporting the amounts and disclosures in the financial 

statements; 

• Assessing the accounting principles used and significant estimates made by management; 

• Evaluating the overall financial statement presentation; 

• Obtaining an understanding of the entity and its operations, including its internal control related to 

financial reporting (including safeguarding assets), and compliance with laws and regulations 

(including execution of transactions in accordance with budget authority); 

• Considering the design of the process for evaluating and reporting on internal control; 

• Testing compliance with selected provisions of laws, regulations, grants and controls applicable 

to the Council that could have a direct and material effect on the financial statements. 

We believe that our audits provide a reasonable basis for our opinion. 

In planning and performing our fiscal years 2011 and 2010 audit, we considered the National Council on 

Disability’s internal control over financial reporting by obtaining an understanding of the Council’s internal 

control, determining whether internal controls had been placed in operation, assessing control risk, and 

performing tests of controls as a basis for designing our auditing procedures for the purpose of 

expressing an opinion on the financial statement, but not for the purpose of expressing an opinion on the 

effectiveness of the Council’s internal control over financial reporting. Accordingly, we do not express an 

opinion on the effectiveness of the Council’s internal control over financial reporting. We did not test all 

internal controls relevant to operating objectives as broadly defined by the Federal Managers’ Financial 

Integrity Act of 1982. Because of inherent limitations in internal control, misstatements due to error or 

fraud, losses, or noncompliance may nevertheless occur and not be detected. We also caution that 

projecting our evaluation to future periods is subject to the risk that controls may become inadequate 

because of changes in conditions or that the degree of compliance with controls may deteriorate. In 

addition, we caution that our internal control testing may not be sufficient for other purposes. 

As part of obtaining reasonable assurance about whether the National Council on Disability’s fiscal years 

2011 and 2010 financial statements are free of material misstatement, we performed tests of the 

Council’s compliance with certain provisions of laws, regulations, contracts and grant agreements, 

noncompliance with which could have a direct and material effect on the determination of financial 

statement amounts, and certain provisions of other laws and regulations specified in OMB Bulletin No. 

07-04, as amended. We limited our tests of compliance to the provisions described in the preceding 

sentence, and we did not test compliance with all laws, regulations, contracts and agreements applicable 

to the Council. However, providing an opinion on compliance with laws, regulations, contracts and grant 

agreements was not an objective of our audit, and accordingly, we do not express such an opinion. We 

caution that noncompliance may occur and not be detected by these tests and that such testing may not 

be sufficient for other purposes. 
4 

Agency Comments and Our Evaluation

In commenting on a draft of this report (see Appendix A), the National Council on Disability concurred 

with the facts and conclusions in our report. 

 

Use and Distribution of Report

This report is intended solely for the information and use of the National Council on Disability’s 

management, Council Members, U.S. Office of Management and Budget, the U.S. Government 

Accountability Office, and the U.S. Congress and is not intended to be and should not be used by anyone 

other than these specified parties. 

Washington, DC 

November 15, 2011 
2011 2010

Assets:

 Intragovernmental:

 Fund Balance With Treasury (Note 2) $ 1,086,477 $ 1,711,213

 Total Intragovernmental 1,086,477 1,711,213

 With The Public:

 Accounts Receivable, net (Note 3) 236

 Loans Receivable (Note 4) 2,962

 Other (Note 5) 28,285

Total Assets $ 1,117,960 $ 1,711,213

Liabilities: (Note 6)

 Intragovernmental:

 Accounts Payable $ 131 28,548 $ 

 Other (Note 7) 13,266 5,644

 Total Intragovernmental 34,192 13,397

 With The Public

 Accounts Payable $ 245,656 211,393 $ 

 Other (Note 7) 127,985 174,807

 Total Liabilities 373,570 433,860

NATIONAL COUNCIL ON DISABILITY

BALANCE SHEETS

As Of September 30, 2011 and 2010

Net Position:

 Unexpended Appropriations - Earmarked Funds (Note 9) 70,789 70,267 

 Unexpended Appropriations - Other Funds 744,355 1,300,189

 Cumulative Results of Operations - Other Funds (70,233) (93,626)

 Total Net Position 744,390 1,277,353 

Total Liabilities and Net Position $ 1,117,960 $ 1,711,213

*Amounts may be off by a dollar due to rounding.

The accompanying notes are an integral part of these financial statements

5
2011 2010

Program Costs:

 Program A:

 Gross Costs (Note 10) $ 3,673,458 $ 3,340,387

 Net Program Costs 3,673,458 3,340,387

Net Cost of Operations $ 3,673,458 $ 3,340,387

*Amounts may be off by a dollar due to rounding.

NATIONAL COUNCIL ON DISABILITY

STATEMENTS OF NET COST

For The Years Ended September 30, 2011 and 2010

The accompanying notes are an integral part of these financial statements

6
Cumulative Results of Operations:

Beginning Balances $ $ $ (93,626) (93,626) $ 

Budgetary Financing Sources:

 Appropriations Used 522 3,621,227 3,621,749

Other Financing Resources (Non-Exchange):

 Imputed Financing 75,102 75,102 

Total Financing Sources 522 3,696,329 3,696,851

Net Cost of Operations (+/-) 522 3,672,936 3,673,458

Net Change 23,393 23,393 

Cumulative Results of Operations $ $ $ (70,233) (70,233) $ 

Unexpended Appropriations:

Beginning Balances $ 70,789 $ 1,300,189 $ $ 1,370,978

Budgetary Financing Sources:

 Appropriations Received 3,271,000 3,271,000

 Other Adjustments (205,606) (205,606) 

 Appropriations Used (522) (3,621,227) (3,621,749)

 Total Budgetary Financing Sources (522) (555,833) (556,356)

Total Unexpended Appropriations 70,267 744,355 814,623

Net Position $ 70,267 $ 674,123 $ $ 744,390

*Amounts may be off by a dollar due to rounding.

NATIONAL COUNCIL ON DISABILITY

STATEMENT OF CHANGES IN NET POSITION

For The Years Ended September 30, 2011 and 2010

2011

Earmarked 

Funds

All Other 

Funds Eliminations

Consolidated 

Total

The accompanying notes are an integral part of these financial statements

7
Cumulative Results of Operations:

Beginning Balances $ $ $ (95,410) (95,410) $ 

Budgetary Financing Sources:

 Appropriations Used 86,973 3,196,199 3,283,171

Other Financing Resources (Non-Exchange):

 Imputed Financing 59,000 59,000 

Total Financing Sources 86,973 3,255,199 3,342,172

Net Cost of Operations (+/-) 86,973 3,253,415 3,340,387

Net Change 1,784 1,784

Cumulative Results of Operations $ $ $ (93,626) (93,626) $ 

Unexpended Appropriations:

Beginning Balances $ 1,225,602 157,762 $ $ $ 1,383,365

Budgetary Financing Sources:

 Appropriations Received 3,271,000 3,271,000

 Other Adjustments (215) (215) 

 Appropriations Used (3,196,199) (86,973) (3,283,171)

 Total Budgetary Financing Sources 74,587 (86,973) (12,386)

Total Unexpended Appropriations 70,789 1,300,189 1,370,978

Net Position $ 70,789 $ 1,206,563 $ $ 1,277,353

*Amounts may be off by a dollar due to rounding.

NATIONAL COUNCIL ON DISABILITY

STATEMENT OF CHANGES IN NET POSITION

For The Years Ended September 30, 2011 and 2010

2010

Earmarked 

Funds

All Other 

Funds Eliminations

Consolidated 

Total

The accompanying notes are an integral part of these financial statements

8
2011 2011 2010 2010

Non-Budgetary Non-Budgetary

Credit Program Credit Program

Budgetary Financing Accounts Budgetary Financing Accounts

Budgetary Resources:

Unobligated Balance:

 Beginning of Period $ $ 516,232 587,382 $ $

Recoveries of Prior Year Obligations 192,468 65,637

Budget Authority:

 Appropriations Received 3,271,000 3,271,000

 Earned

 Collected 51,759 3,293

 Subtotal $ $ 3,274,293 3,322,759 $ $

Permanently Not Available (215) (205,606) 

Total Budgetary Resources $ $ 3,855,947 3,897,002 $ $

Status of Budgetary Resources:

Obligations Incurred

 Direct (Note 11) $ $ 3,268,566 3,655,093 $ $

 Subtotal $ 3,268,566 3,655,093 $ 

Unobligated Balances 

 Apportioned 82,543 263,879

 Subtotal $ $ 263,879 82,543 $ $

Unobligated Balances - Not Available 323,503 159,366 

Total Status of Budgetary Resources $ $ 3,855,947 3,897,002 $ $

Change in Obligated Balances:

Obligated Balance, Net:

 Unpaid Obligations, Brought Forward, October 1 $ $ 1,053,583 1,123,831 $ $

Obligations Incurred 3,655,093 3,268,566

Gross Outlays (-) (3,741,888) (3,132,681)

Recoveries of Prior-Year Unpaid Obligations, Actual (-) (192,468) (65,637)

Change in Uncollected Customer Payments from Federal Sources

Obligated Balance, Net, End of Period:

 Unpaid Obligations (+) (Note 12) 844,568 1,123,831

 Total, Unpaid Obligated Balance, Net, End of Period $ $ 1,123,831 844,568 $ $

Net Outlays:

Gross Outlays (+) 3,741,888 3,132,681

Offsetting Collections (-) (51,759) (3,293)

Net Outlays $ $ 3,129,387 3,690,129 $ $

*Amounts may be off by a dollar due to rounding.

NATIONAL COUNCIL ON DISABILITY

STATEMENTS OF BUDGETARY RESOURCES

For The Years Ended September 30, 2011 and 2010

The accompanying notes are an integral part of these financial statements

9
NATIONAL COUNCIL ON DISABILITY 

NOTES TO FINANCIAL STATEMENTS 

SEPTEMBER 30, 2011 AND 2010

10

NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES 

Reporting Entity

The National Council on Disability (NCD) is an independent agency of the Executive 

Branch of the United States Government that makes recommendations to the President 

and Congress on issues affecting Americans with disabilities. 

NCD was initially established in 1978 as an advisory board within the Department of 

Education (Public Law 95-602). The Rehabilitation Act Amendments of 1984 (Public 

Law 98-221) transformed NCD into an independent agency and required NCD to provide 

expert advice to Congress and the Administration. The Rehabilitation Act Amendments 

of 1992 and 1998 and the Education of the Deaf Act Technical Amendments of 1993 

updated NCD’s statutory mandate. 

NCD is composed of fifteen members appointed by the President and confirmed by the 

U.S. Senate. The Council members set the agency budget and establish the parameters 

for what it will support. The NCD executive director has full responsibility for carrying 

out the agency’s operations as necessary to accomplish the goals and mission of the 

agency as established by the Council members. 

NCD’s overall purpose is to promote policies, programs, practices, and procedures that 

guarantee equal opportunity for all individuals with disabilities, regardless of the nature 

or severity of the disability; and to empower individuals with disabilities to achieve 

economic self-sufficiency, independent living, and inclusion and integration into all 

aspects of society. This mission is accomplished by serving as a policy agency that 

publishes reports and works with other federal agencies on policy development and 

implementing best practices. Strategic goals established for fiscal year 2011 included: 

Basis of Presentation 

These financial statements have been prepared from the accounting records of NCD in 

accordance with generally accepted accounting principles (GAAP) as promulgated by the 

Federal Accounting Standards Advisory Board (FASAB), and the form and content for 

entity financial statements specified by the Office of Management and Budget (OMB) in 

OMB Circular No. A-136, “Financial Reporting Requirements.” GAAP for Federal 

entities is the hierarchy of accounting principles prescribed in Statement of Federal 

Financial Accounting Standards (SFFAS) 34, “The Hierarchy of Generally Accepted 

Accounting Principles, Including the Application of Standards issued by the Financial 

Accounting Standards Board.” 
NATIONAL COUNCIL ON DISABILITY 

NOTES TO FINANCIAL STATEMENTS 

SEPTEMBER 30, 2011 AND 2010

11

NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES - (CONTINUED) 

Basis of Presentation – (Continued)

OMB Circular No. A-136 requires agencies to prepare principal statements, include a 

Balance Sheet, Statement of Net Cost, Statement of Changes in Net Position, Statement 

of Budgetary Resources. The balance sheet presents, as of September 30, 2011, amounts 

of future economic benefits owned or managed by NCD (assets), amounts owed by NCD 

(liabilities), and amounts which comprise the difference (net position). The Statement of 

Net Cost reports the full cost of the program, both direct and indirect costs of the output, 

and the costs of identifiable supporting services provided by other segments within NCD 

and other reporting entities. The Statement of Budgetary Resources reports an agency’s 

budgetary activity. 

Basis of Accounting

Transactions are recorded on the accrual accounting basis in accordance with OMB 

Circular No. A-136. Under the accrual basis of accounting, revenues are recognized 

when earned, and expenses are recognized when a liability is incurred, without regard to 

receipt or payment of cash. 

Use of Estimates

The preparation of financial statements requires management to make estimates and 

assumptions that affect the reported amounts of assets and liabilities, the disclosure of 

contingent assets and liabilities at the date of the financial statements, and the reported 

amounts of revenues and expenses during the reporting period. Actual results may differ 

from those estimates. 

Budgets and Budgetary Accounting

NCD follows standard federal budgetary accounting policies and practices in accordance 

with OMB Circular A-11, “Preparation, Submission, and Execution of the Budget,” dated 

June 2008. Budgetary accounting facilitates compliance with legal constraints and 

controls over the use of federal funds. Each year, Congress provides NCD appropriations 

to incur obligations in support of agency programs. For Fiscal Years (FY) 2011 and 

2010, NCD is accountable for general fund appropriations and no-year fund carryover. 

NCD recognizes budgetary resources as assets when cash (funds held by Treasury) is 

made available through warrants and when spending authority from the offsetting 

collections is incurred. 
NATIONAL COUNCIL ON DISABILITY 

NOTES TO FINANCIAL STATEMENTS 

SEPTEMBER 30, 2011 AND 2010

12

NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES - (CONTINUED) 

Revenues and Other Financing Sources

NCD receives substantially all of the funding needed to support its programs through 

appropriations. NCD receives annual and no-year appropriations that may be used, 

Revenues and Other Financing Sources – (Continued)

within statutory limits, for operating and capital expenditures. Appropriations are 

recognized as revenues as the related programs or administrative expenses are incurred. 

Other financing sources for NCD consist of imputed financing sources which are costs 

financed by other federal entities on behalf of NCD, as required by SFFAS No. 5, 

“Accounting for Liabilities of the Federal Government.” In certain instances, operating 

costs of NCD are paid out of funds appropriated to other federal agencies. In accordance 

with SFFAS 5, all expenses of a federal entity should be reported by that agency 

regardless of whether the agency will ultimately pay those expenses. Amounts for certain 

expenses of NCD, which will be paid by other federal agencies, are recorded in the 

Statement of Net Cost. A related amount is recognized in the Statement of Changes in 

Net Position as an imputed financing source. NCD records imputed expenses and 

financing sources for employee retirement plan contributions, group term life insurance, 

and health benefit costs, which are paid by the Office of Personnel Management (OPM). 

Personnel Compensation and Benefits

Salaries and wages of employees are recognized as accrued payroll expenses and related 

liabilities as earned. These expenses are recognized as a funded liability when accrued. 

Annual leave is accrued as it is earned by employees and is included in personnel 

compensation and benefit costs. An unfunded liability is recognized for earned but 

unused annual leave, since from a budgetary standpoint, this annual leave will be paid 

from future appropriations when employees use the leave. The amount accrued is based 

upon current pay rates for employees. Sick leave and other types of leave that are not 

vested are expensed when used and no future liability is recognized for these amounts. 

NCD’s employees participate in one of two retirement programs, either the Civil Service 

Retirement System (CSRS) or the Federal Employees Retirement System (FERS), which 

became effective on January 1, 1987. NCD and its employees both contribute to these 

systems. Although NCD funds a portion of the benefits under CSRS and FERS and 

makes the necessary payroll withholdings, it does not report assets associated with these 

benefit plans in accordance with SFFAS 5. 

For CSRS employees, NCD contributes an amount equal to 11.2% of the employees’ 

basic pay to the plan. For FERS employees, NCD contributes an amount equal to 7% of 

the employees’ basic pay to the plan. 
NATIONAL COUNCIL ON DISABILITY 

NOTES TO FINANCIAL STATEMENTS 

SEPTEMBER 30, 2011 AND 2010

13

NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES - (CONTINUED) 

Personnel Compensation and Benefits – (Continued)

Both CSRS employees and FERS employees are eligible to participate in the Thrift 

Savings Plan (TSP). The TSP is a defined contribution retirement plan intended to 

supplement the benefits provided under CSRS and FERS. For FERS employees, NCD 

contributes an amount equal to 1% of the employee’s basic pay to the TSP and matches 

employee contributions up to an additional 4%. CSRS employees receive no matching 

contribution from NCD. 

OPM is responsible for reporting assets, accumulated plan benefits, and unfunded 

liabilities, if any, applicable to CSRS participants and FERS employees governmentwide, including NCD’s employees. NCD has recognized an Imputed Cost and Imputed 

Financing Source for the difference between the estimated service cost and the 

contributions made by NCD and its covered employees. The estimated cost of pension 

benefits is based on rates issued by OPM. 

Employees are entitled to participate in the Federal Employees Group Life Insurance 

(FEGLI) Program. Participating employees can obtain “basic life” term life insurance, 

with the employee paying two-thirds of the cost and NCD paying one-third. Additional 

coverage is optional, to be paid fully by the employee. The basic life coverage may be 

continued into retirement if certain requirements are met. OPM administers the FEGLI 

program and is responsible for the reporting of related liabilities. Each fiscal year, OPM 

calculates the U.S. Government’s service cost for the post-retirement portion of basic life 

coverage. Because NCD’s contributions to the basic life coverage are fully allocated by 

OPM to the pre-retirement portion of coverage, the Board has recognized the entire 

service cost of the post-retirement portion of basic life coverage as an Imputed Cost and 

Imputed Financing Source. 

Assets and Liabilities

Intra-governmental assets and liabilities arise from transactions between NCD and other 

Federal entities. 

Funds with the U.S. Treasury comprise the majority of assets on NCD’s balance sheet. 

All other assets result from activity with non-federal sources. 

Liabilities represent amounts that are likely to be paid by NCD as a result of transactions 

that have already occurred. The accounts payable portion of liabilities consists of 

amounts owed to federal agencies and commercial vendors for goods, services, and other 

expenses received but not yet paid. 

Liabilities covered by budgetary or other resources are those liabilities of NCD for which 

Congress has appropriated funds, or funding is otherwise available to pay amounts due. 
NATIONAL COUNCIL ON DISABILITY 

NOTES TO FINANCIAL STATEMENTS 

SEPTEMBER 30, 2011 AND 2010

14

NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES - (CONTINUED) 

Fund Balance with Treasury

The U.S. Department of the Treasury (Treasury) processes NCD’s receipts and 

disbursements. Fund Balance with Treasury is the aggregate amount of the agency’s 

accounts with Treasury for which the agency is authorized to liquidate obligations, pay 

funded liabilities, and make expenditures. The fund balance is increased through the 

receipt of non-expenditure Treasury warrants for appropriations, positive nonexpenditure transfers, and other expenditure inflows of funds. The Fund Balance with 

Treasury is reduced through non-expenditure Treasury Warrants for rescissions, negative 

non-expenditure transfers, disbursements, and other expenditure cash outflows of funds. 

NCD’s funds with the U.S. Treasury are cash balances from appropriations as of the 

fiscal year-end from which NCD is authorized to make expenditures and pay liabilities 

resulting from operational activity. 

General Property, Plant, and Equipment, Net

Property, plant, and equipment (PP&E) have been defined in the Federal Government as 

tangible items owned by the Federal Government and having an expected useful life of 

greater than two years. NCD has established the following policies for PP&E: 

PP&E is reported at acquisition cost. 

The capitalization threshold is $5,000 for assets with a useful life of two or more years. 

For bulk purchases, items will be capitalized when the individual useful lives are at least 

two years and the property has an aggregate value of $100,000 or more. 

Acquisitions of PP&E that do not meet the capitalization criteria outlined above are 

recorded as operating expenses. General PP&E consists of items that are used by NCD to 

support its mission. 

Depreciation on assets is calculated using the straight-line method. Depreciation begins 

the month after the asset is placed in service. 

Useful lives are as follows: 

 Equipment - 4 years 

 Furniture - 4 years 

Maintenance, repairs and minor renovations are expensed as incurred. Expenditures that 

materially increase values, change capacities, or extend useful lives are capitalized. 
NATIONAL COUNCIL ON DISABILITY 

NOTES TO FINANCIAL STATEMENTS 

SEPTEMBER 30, 2011 AND 2010

15

NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES - (CONTINUED) 

General Property, Plant, and Equipment, Net – (Continued)

The costs of any leasehold improvements financed with NCD appropriated funds is 

capitalized if the total cost exceeds $25,000. Construction costs are accumulated as 

“construction in-progress” until completion, at which time they are transferred to 

“leasehold improvements” and depreciated over 7 years or the remainder of the lease, 

whichever is less. 

Internal use software development and acquisition costs of $25,000 are capitalized as 

“software development-in-progress” until the development stage is completed and the 

software is successfully tested. At acceptance, “software development-in-progress” costs 

are reclassified as “internal use software” and amortized using the straight-line method 

over an estimated useful life of 4 years. Purchased commercial software that does not 

meet the capitalization criteria is expensed. Enhancements that do not add significant 

new capability or functionality are expensed. 

Prepaid and Deferred Charges

Payments in advance of the receipt of goods and services are recorded as prepaid charges 

at the time of prepayment and recognized as expenses when the related goods and 

services are received. 

Liabilities

Liabilities represent amounts expected to be paid as the result of a transaction or event 

that has already occurred. Liabilities covered by budgetary resources are liabilities 

incurred which are covered by realized budgetary resources as of the balance sheet date. 

Available budgetary resources include new budget authority, spending authority from the 

offsetting collections, recoveries of unexpired budget authority through downward 

adjustments of prior year obligations, and unobligated balances of budgetary resources at 

the beginning of the year. Unfunded liabilities are not considered to be covered by such 

budgetary resources. Examples of unfunded liabilities are actuarial liabilities for future 

Federal Employees’ Compensation Act (FECA) payments and annual leave. The 

Government, acting in its sovereign capacity, can abrogate liabilities arising from other 

than contracts. 
NATIONAL COUNCIL ON DISABILITY 

NOTES TO FINANCIAL STATEMENTS 

SEPTEMBER 30, 2011 AND 2010

16

NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES - (CONTINUED) 

Contingencies

The criteria for recognizing contingencies for claims are (1) a past event or exchange 

transaction has occurred as of the date of the statements; (2) a future outflow or other 

sacrifice of resources is probable; and (3) the future outflow or sacrifice of resources is 

measurable (reasonably estimated). NCD recognizes material contingent liabilities in the 

form of claims, legal action, administrative proceedings and environmental suits that 

have been brought to the attention of legal counsel, some of which will be paid by the 

Treasury Judgment Fund. It is the opinion of management and legal counsel that the 

ultimate resolution of these proceedings, actions, and claims, will not materially affect 

the financial position of results of operations. 

Net Position

Net position consists of unexpended appropriations and cumulative results of operations. 

Unexpended appropriations represent amounts of budgetary authority to include 

unobligated or obligated balances not rescinded or withdrawn. Cumulative results of 

operations are comprised of the following: (1) the difference between revenues and 

expenses, (2) the net amount of transfers of assets in and out without reimbursement, and 

(3) donations, all since inception of the fund(s). 

NOTE 2 – FUND BALANCE WITH TREASURY 

All of NCD’s fund balance with treasury is coming from appropriations. No trust, 

revolving or other fund type are used to fund NCD’s activities. NCD operates as an 

annual fund, where each year is a new appropriation. This fund balance with treasury is a 

consolidated balance of one no-year fund and five annual funds (FY 2007, FY 2008, FY 

2009, FY 2010, and FY 2011). The annual fund for FY 2006 is cancelled and the 

remaining fund balance of $199,064 is given back to US Treasury during fiscal year 

2011. 

A. Fund Balance with Treasury 2011 2010

Appropriated Fund $1,086,477 $1,711,213 

B. Status of Fund Balance with Treasury

1) Unobligated Balance

a) Available 82,543 263,879 

b) Unavailable 159,366 323,503 

2) Obligated Balance not yet Disbursed 844,568 1,123,831 

Total $1,086,477 $1,711,213 
NATIONAL COUNCIL ON DISABILITY 

NOTES TO FINANCIAL STATEMENTS 

SEPTEMBER 30, 2011 AND 2010

17

NOTE 3 – ACCOUNTS RECEIVABLE, NET 

Accounts Receivable, Net from the Public represents the Accounts Receivable from 

current employees. 

2011 2010

Accounts Receivable - With the Public $236

NOTE 4 – LOANS RECEIVABLE, NET

Loans Receivable, Net from the Public represents a Loan Receivable from a current 

employee. 

2011 2010

Loans Receivable - With the Public $2,962

NOTE 5 – OTHER ASSETS WITH THE PUBLIC 

NCD has an obligation that involves the advancement of funds for a current employee 

and with other non-federal entities. 

2011 2010

Assets With The Public - Other Assets 28,285 $ 

NOTE 6 – LIABILITIES NOT COVERED BY BUDGETARY RESOURCES

Liabilities of NCD are classified as liabilities covered or not covered by budgetary 

resources. As of September 30, 2011, NCD showed liabilities covered by budgetary 

resources of $272,354 and liabilities not covered by budgetary resources of $101,216. As 

of September 30, 2010, NCD showed liabilities covered by budgetary resources of 

$340,234 and liabilities not covered by budgetary resources of $93,626. 

 

As of September 30, 2011, liabilities covered by budgetary resources is composed of 

Accounts Payable of $239,941, Accrued Funded Payroll and Leave of $25,915, and 

Employer Contributions and Payroll Taxes Payable of $6,498. As of September 30, 

2010, liabilities covered by budgetary resources is composed of Accounts Payable of 

$245,787, Accrued Funded Payroll and Leave of $81,181, and Employer Contributions 

and Payroll Taxes Payable of $13,266. 
NATIONAL COUNCIL ON DISABILITY 

NOTES TO FINANCIAL STATEMENTS 

SEPTEMBER 30, 2011 AND 2010

18

NOTE 6 – LIABILITIES NOT COVERED BY BUDGETARY RESOURCES – 

(CONTINUED)

2011 2010

With the Public

Other (Unfunded leave liability) 101,216 93,626

Total liabilities not covered by budgetary resources 101,216 93,626

Total liabilities covered by budgetary resources 272,354 340,234

Total Liabilities $373,570 $433,860

NOTE 7 – OTHER LIABILITIES 

As of September 30, 2011, other liabilities with the public consist of Accrued Funded 

Payroll and Leave of $25,915, unfunded leave in the amount of $101,216, and employer 

contributions and payroll taxes payable – TSP of $855. Other Intragovernmental 

liabilities consist of employer contributions and payroll taxes payable of $5,644. As of 

September 30, 2010, other liabilities with the public consist of Accrued Funded Payroll 

and Leave of $81,181 and unfunded leave in the amount of $93,626. Other 

Intragovernmental liabilities consist of employer contributions and payroll taxes payable 

of $13,266. 

With the Public Non-Current Current Total

2011 Other Liabilities $101,216 $26,770 $127,985 *

2010 Other Liabilities $93,626 $81,181 $174,807

*Rounding

Intragovernmental Non-Current Current Total

2011 Other Liabilities $0 $5,644 $5,644

2010 Other Liabilities $0 $13,266 $13,266
NATIONAL COUNCIL ON DISABILITY 

NOTES TO FINANCIAL STATEMENTS 

SEPTEMBER 30, 2011 AND 2010

19

NOTE 8 - LEASES 

Entity as Lessee: 

Operating Leases

NCD leases office space at 1331 F Street, NW, Washington, DC. The lease was entered 

into and became effective December 2007, and expires September 2011. The lease does 

not contain an option to renew, and the space may be vacated at any time upon four (4) 

months written notice. As of September 30, 2011 the lease has expired and the tenant is 

renegotiating and continues to occupy the space. 

NOTE 9 – EARMARKED FUNDS 

In 2007, $300,000 was appropriated to remain available until expended, for necessary 

expenses related to the requirements of the Post-Katrina Emergency Management Reform 

Act of 2006, as enacted by the Department of Homeland Security Appropriations Act, 

2007 (Public Law 109-295). 

 
NATIONAL COUNCIL ON DISABILITY 

NOTES TO FINANCIAL STATEMENTS 

SEPTEMBER 30, 2011 AND 2010

20

NOTE 9 – EARMARKED FUNDS – (CONTINUED) 

2011

NCD Earmarked 

Funds

NCD Other 

Funds Total Funds

Balance Sheet as of Sept. 30

ASSETS

Fund Balance with Treasury 105,267 $ 981,210 $ 1,086,477 $ 

Assets with the Public:

 Accounts Receivable 236 236 

 Loans Receivable 2,962 2,962 

Other Assets 28,285 28,285 

 Total Assets 105,267 $ 1,012,693 $ 1,117,960 $ 

Intragovernmental Liabilities:

Accounts Payable 28,548 $ 28,548 $ 

Other Liabilities 5,644 5,644 

Total Intragovenmental Liabilities 34,192 $ 34,192 $ 

Liabilities with the Public:

Accounts Payable 35,000 $ 176,393 $ 211,393 $ 

Other Liabilities 127,985 $ 127,985 $ 

Total Liabilities with the Public 35,000 $ 304,378 $ 339,378 $ 

Total Liabilites $ 338,570 35,000 $ 373,570 $ 

Unexpended Appropriations 70,267 $ 744,355 $ 814,623 $ 

Cumulative Results of Operations (70,233) $ (70,233) $ 

 Total Liabilities and Net Position 105,267 $ 1,012,693 $ 1,117,960 $ 

Statement of Net Cost For the 

Period Ended Sept. 30

Gross Program Costs 522 $ 3,672,936 $ 3,673,458 $ 

Net Program Costs 522 $ 3,672,936 $ 3,673,458 $ 

Net Cost of Operations 522 $ 3,672,936 $ 3,673,458 $ 

Statement of Changes in Net Position

For the Period Ended Sept. 30

Cumulative Results of Operations:

Beginning Balances (93,626) $ (93,626) $ 

Budgetary Financing Sources:

Appropriations Used 522 $ 3,621,227 $ 3,621,749 $ 

Other Financing Sources

 Imputed Financing 75,102 $ 75,102 $ 

Total Financing Sources 522 $ 3,696,329 $ 3,696,851 $ 

Net Cost of Operations 522 $ 3,672,936 $ 3,673,458 $ 

Change in Net Position 23,393 $ 23,393 $ 

Cumulative Results of Operations (70,233) $ (70,233) $ 

Unexpended Appropriations:

Beginning Balances 70,789 $ 1,300,189 $ 1,370,978 $ 

Budgetary Financing Sources:

Appropriations Received 3,271,000 3,271,000 

Other Adjustments (205,606) (205,606) 

Appropriations Used (522) (3,621,227) (3,621,749) 

Total Budgetary Financing Sources (522) $ (555,833) $ (556,356) $ 

Total Unexpended Appropriations 70,267 $ 744,355 $ 814,623 $ 

Net Position End of Period 70,267 $ 674,123 $ 744,390 $ 
NATIONAL COUNCIL ON DISABILITY 

NOTES TO FINANCIAL STATEMENTS 

SEPTEMBER 30, 2011 AND 2010

21

NOTE 9 – EARMARKED FUNDS – (CONTINUED)

FY 2010

NCD Earmarked 

Funds

NCD Other 

Funds Total Funds

Balance Sheet as of Sept. 30

ASSETS

Fund Balance with Treasury 78,110 $ 1,633,103 $ 1,711,213 $ 

 Total Assets 78,110 $ 1,633,103 $ 1,711,213 $ 

Intragovernmental Liabilities:

Accounts Payable 131 $ 131 $ 

Other Liabilities 13,266 13,266 

Total Intragovenmental Liabilities 13,397 $ 13,397 $ 

Liabilities with the Public:

Accounts Payable 7,321 $ 238,335 $ 245,656 $ 

Other Liabilities 174,807 $ 174,807 $ 

Total Liabilities with the Public 7,321 $ 413,143 $ 420,463 $ 

Total Liabilites $ 426,540 7,321 $ 433,860 $ 

Unexpended Appropriations 70,789 $ 1,300,189 $ 1,370,978 $ 

Cumulative Results of Operations (93,626) $ (93,626) $ 

 Total Liabilities and Net Position 78,110 $ 1,633,103 $ 1,711,213 $ 

Statement of Net Cost For the 

Period Ended Sept. 30

Gross Program Costs 86,973 $ 3,253,415 $ 3,340,387 $ 

Net Program Costs 86,973 $ 3,253,415 $ 3,340,387 $ 

Net Cost of Operations 86,973 $ 3,253,415 $ 3,340,387 $ 

Statement of Changes in Net Position

For the Period Ended Sept. 30

Cumulative Results of Operations:

Beginning Balances (95,410) $ (95,410) $ 

Budgetary Financing Sources:

Appropriations Used 86,973 $ 3,196,199 $ 3,283,171 $ 

Other Financing Sources

 Imputed Financing 59,000 $ 59,000 $ 

Total Financing Sources 86,973 $ 3,255,199 $ 3,342,172 $ 

Net Cost of Operations 86,973 $ 3,253,415 $ 3,340,387 $ 

Change in Net Position 1,784 $ 1,784 $ 

Cumulative Results of Operations (93,626) $ (93,626) $ 

Unexpended Appropriations:

Beginning Balances 157,762 $ 1,225,602 $ 1,383,365 $ 

Budgetary Financing Sources:

Appropriations Received 3,271,000 3,271,000 

Other Adjustments (215) (215) 

Appropriations Used (86,973) (3,196,199) (3,283,171) 

Total Budgetary Financing Sources (86,973) $ 74,587 $ (12,386) $ 

Total Unexpended Appropriations 70,789 $ 1,300,189 $ 1,370,978 $ 

Net Position End of Period 70,789 $ 1,206,563 $ 1,277,353 $ 
NATIONAL COUNCIL ON DISABILITY 

NOTES TO FINANCIAL STATEMENTS 

SEPTEMBER 30, 2011 AND 2010

22

NOTE 10 – INTRAGOVERNMENTAL COSTS AND EXCHANCE REVENUE 

Intragovernmental costs are those of goods/services purchased from a federal entity. 

Total Total 

2011 2010

Program A

Intragovernmental costs 843,738 536,324

Public costs 2,829,721 2,804,063

Total Program A costs 3,673,458 * 3,340,387

Total Program A 3,673,458 * 3,340,387

* Rounding 

NOTE 11 – APPORTIONMENT CATEGORIES OF OBLIGATIONS INCURRED 

Obligations for NCD are split between category A and category B, which is the amount 

of direct obligations incurred against amounts apportioned under category A and category 

B on the latest SF 132. 

2011 2010

Direct

Category A $1,782 $12 

Category B 3,653,311 3,268,554 

$3,655,093 $3,268,566

NOTE 12 – UNDELIVERED ORDERS AT THE END OF THE PERIOD 

The amount of Unpaid Obligated Balance, Net, End of Period includes obligations 

relating to Undelivered Orders (good and services contracted for but not yet received at 

the end of the year) and Accounts Payable (amounts owed at the end of the year for 

goods and services received). 

Undelivered 

Orders

Delivered 

Orders, 

Obligation

s Unpaid

Unpaid Obligated Balance 

Net

2011 572,214 272,354 $844,568

2010 783,597 340,234 $1,123,831
NATIONAL COUNCIL ON DISABILITY 

NOTES TO FINANCIAL STATEMENTS 

SEPTEMBER 30, 2011 AND 2010

23

NOTE 13 – RECONCILIATION OF NET COST OF OPERATIONS 

(PROPRIETARY) TO BUDGET (FORMERLY THE STATEMENT OF 

FINANCING) 

NATIONAL COUNCIL ON DISABILITY

2011 2010

Resources Used to Finance Activities:

Budgetary Resources Obligated

 Obligations Incurred 3,655,093 $ 3,268,566 $ 

 Less: Spending Authority from Offsetting Collections 

 and Recoveries 244,226 68,930 

 Net Obligations 3,410,866 3,199,636

Other Resources

 Imputed Financing from Costs Absorbed by Others 75,102 59,000 

 Other Resources (+/-)

Net Other Resources Used to Finance Activities 75,102 59,000

Total Resources Used to Finance Activities 3,485,968 3,258,636

Resources Used to Finance Items not Part of the Net Cost of Operations

Change in Budgetary Resources Obligated for Goods

 Services and Benefits Ordered But Not Yet Provided (183,098) (83,536) 

Resources that Finance the Acquisition of Assets 3,198 

Total Resources Used to Finance Items Not Part of the Net Cost

 of Operations (179,900) (83,536)

Total Resources Used to Finance the Net Cost of Operations 3,665,868 3,342,172

Components of the Net Cost of Operations that will not Require or Generate

Resources in the Current Period:

Components Requiring or Generating Resources in Future Periods:

 Increase/(decrease) in Annual Leave Liability 7,590 (1,784) 

Total Components of Net Cost of Operations that will Require or Generate (1,784) 7,590 

Resources in Future Periods

Total Components of Net Cost of Operations that will not Require or Generate

Resources in the Current Period (1,784) 7,590 

Net Cost of Operations $ 3,340,387 3,673,458 $ 

Liabilities not covered by budgetary resources total $101,216 and the change in 

components requiring or generating resources in future period shows $7,590. The $7,590 

is the net increase of future funded expenses – leave between appropriations of annual 

fund 2010 and annual fund 2011. Accrued funded payroll liability is covered by 

budgetary resources and is included in the net cost of operations. Whereas, the unfunded 

leave liability includes the expense related to the increase in annual leave liability for 

which the budgetary resources will be provided in a subsequent period. 

2011 2010

Liabilities not covered by budgetary resources $101,216 $93,626 

Change in components requiring/generating resources $7,590 ($1,784)
NATIONAL COUNCIL ON DISABILITY 

NOTES TO FINANCIAL STATEMENTS 

SEPTEMBER 30, 2011 AND 2010

24

NOTE 14 – SUBSEQUENT EVENTS 

Management has evaluated subsequent events occurring after the balance sheet date and 

through the date of November 15, 2011, the date the financial statements were available 

for release. Based on this evaluation, management has determined that no subsequent 

events have occurred that require disclosure in the financial statements. 
APPENDIX A – 

NATIONAL COUNCIL ON DISABILITY COMMENTS ON 

DRAFT AUDIT REPORT 

APPENDIX B – 

NOTICE OF FINDINGS AND RECOMMENDATIONS AND MANAGEMENT 

RESPONSES 
National Council on Disability 

Notice of Finding and Recommendation 

FYE September 30, 2011

11-01: Ineffective Monitoring of Internal Control Effectiveness 

Condition: National Council on Disability lacks a well-defined process to regularly evaluate 

whether internal controls are effectively designed, have been properly 

implemented, and are operating effectively. This is a repeat finding now 

considered a significant deficiency. 

Criteria: The Federal Manager’s Financial Integrity Act of 1982 (FMFIA) requires all 

federal agencies to annually assess and report on the adequacy of management 

control systems. GAO and OMB have established guidelines for agencies to 

monitor on an on-going basis the effectiveness of internal controls in detecting 

and preventing material misstatements to the financial statements and complying 

with relevant laws and regulations. Additionally, Statement of Auditing 

Standards (SAS) 109 Understanding the Entity and Its Environment and 

Assessing the Risks of Material Misstatement states: “An important management 

responsibility is to establish and maintain internal control on an ongoing basis. 

Management’s monitoring of controls includes whether they are operating as 

intended and that they are modified as appropriate for changes in conditions.” 

Cause: Management has not finalized its design and implementation of controls for 

evaluating that key internal controls are designed effectively to mitigate identified 

risks, and monitoring that controls have been implemented and are operating 

effectively. 

Effect: A control deficiency may occur in the course of the organization’s operations and 

not be detected, leading to a misstatement of the organization’s financial 

statements, misappropriation of assets or noncompliance with relevant laws, 

regulations, grants and contracts. 

Recommendation:

Management should prioritize the risk factors identified in its risk assessment 

process and determine if internal controls have been suitably designed and 

implemented to reduce those risks to an acceptable level. Evaluations should be 

documented in writing. Results should be shared with accounting service 

provider where appropriate. 

On-going monitoring of internal control effectiveness should include activities 

such as management’s review of whether: (1) financial transactions are being 

initiated, authorized, recorded and processed through to the general ledger in 

accordance with policies, procedures and controls on a consistent basis or if 
Notice of Finding and Recommendation 11-01 

Ineffective Monitoring of Internal Control Effectiveness 

Page 2 of 2

controls are being overridden, (2) internal controls are effectively detecting and 

preventing the types of errors or omissions anticipated by the agency’s risk 

assessment process the GSA External Services Division “user control 

considerations” in its SSAE-16 reports for the Pegasys Financial Management 

System and the Payroll Accounting and Reporting System, (3) key persons are 

ensuring compliance with terms of relevant laws, regulations, grants and 

contracts, (4) ensuring that the findings of audits and other internal or external 

financial and program reviews are promptly resolved and that results of 

monitoring are reported to the agency’s governing body. 

Management Response:

Management concurs with the finding and is in the process of completing open 

items on the corrective action plan. Since the issuance of the FY 2010 audit report 

on April 29, 2011, management has implemented the following corrective actions: 

• NCD developed and implemented a formal risk assessment process to 

comprehensively identify, analyze, and evaluate risks that could lead to a 

material misstatement of the financial statements or a misappropriation of 

assets or fraudulent financial reporting. On July 27, 2011 management 

completed a written risk assessment to identify risks of material 

misstatement of the financial statements, fraud, and non-compliance with 

laws and regulations that could have a direct and material effect on the 

financial statements. The assessment was submitted to the audit and 

finance committee. 

• Management increased on-going monitoring of internal control 

effectiveness ensuring that the findings of audits and other internal or 

external financial and program reviews were promptly resolved and that 

results of monitoring were reported to the agency's governing body. 

Below is a listing of the remaining corrective actions and target completion dates: 

• Management shall continue to monitor whether key controls are operating 

effectively. 
Exhibit B List of Acronyms

FY 2011 Performance & Accountability Report

ADA Americans with Disabilities Act of 1990, as amended

AICPA American Institute of Certified Public Accountants

ATDA Accountability of Tax Dollars Act of 2002

CFO Chief Financial Officer

CFR Code of Federal Regulations

CSRS Civil Service Retirement System

DOL Department of Labor

ED Executive Director

ESEA Elementary and Secondary Education Act

FASAB Federal Accounting Standards Advisory Board

FBWT Fund Balance with Treasury

FECA Federal Employees Compensation Act

FERS Federal Employees’ Retirement System

FFMIA Federal Financial Management Improvement Act

FICA Federal Insurance Contribution Act

FISMA Federal Information Security Management Act

FMFIA Federal Managers’ Financial Integrity Act

FOIA Freedom of Information Act

FTE Full-time Equivalent

FY Fiscal Year

GAAP Generally Accepted Accounting Principles

GAO Government Accountability Office

GPRA Government Performance and Results Act

GSA General Services Administration

IPIA Improper Payments Information Act

IT Information Technology

MD&A Management’s Discussion and Analysis

NCD National Council on Disability

NCLBA No Child Left Behind Act reauthorization

OMB Office of Management and Budget

OPM Office of Personnel Management

PP&E Property, Plant and Equipment

PAR Performance and Accountability Report

SAS Statement on Auditing Standards

SBR Statement of Budgetary Resources

SFFAS Statement of Federal Financial Accounting Standards

SNC Statement of Net Cost

TSP Thrift Savings Plan

UDO Undelivered Orders

USC United States Code